In six weeks, the leveraged MicroStrategy ETF (MSTU) has amassed over $1 billion in assets under management (AUM) as the MSTR share reaches new all-time highs.
Within six months of its debut, T-Rex’s 2x MicroStrategy ETF (MSTU) has achieved an extraordinary 225% growth.
Eric Balchunas, a strategist at Bloomberg ETFs, observed that this represents an annual growth rate of 57,000%. Recently, MicroStrategy has experienced significant growth, as evidenced by the MSTR stock price, which recently surpassed $250 and reached new all-time highs.
MicroStrategy ETF enters top 1% since launch
The MicroStrategy ETF MSTU has surpassed half a billion in daily trading volumes, thereby achieving a position in the top 1% of all ETFs in terms of trading volumes. Furthermore, the original 1.75x MSTR ETF has been surpassed by this 2x leveraged ETF from MicroStrategy, which has over $1 billion in assets under management (AUM).
According to Bloomberg analyst Eric Balchunas, MSTU essentially functions like a “4x Bitcoin ETF,” with a 30-day volatility of 168%, in contrast to the 41% of BlackRock’s IBIT ETF.
By doubling the already leveraged MicroStrategy stock, he noted that this product obtains a level of exposure that is otherwise prohibited by U.S. regulations on Bitcoin ETFs. Balchunas added, “They effectively created the ultimate trading tool by 2x-ing $MSTR (which is 2x BTC),” emphasizing the distinctive allure of MicroStrategy ETF MSTU.
The MSTR stock rally is unstoppable
Over the past month, MicroStrategy’s share price has experienced an unprecedented surge, with a staggering 51% increase. The 10:1 MSTR stock split in August has reignited investor interest by encouraging increased participation.
The MSTR stock has increased by an astonishing 1500% since the Bitcoin strategy was implemented in September 2020. Over these years, it has also functioned as a proxy bet for Bitcoin, surpassing BTC in several phases. Also, MSTR surpasses trillion-dollar technology companies such as NVIDIA in terms of total percentage returns.
In recent years, MicroStrategy has also engaged in numerous stock transactions and raised funds to acquire additional Bitcoins. Consequently, it has been BTC’s most significant corporate holder, with an investment of $14 billion over the past few years. Furthermore, the organization intends to establish its own Bitcoin Bank.
Michael Saylor, the executive chairman of MicroStrategy, has been disseminating his Bitcoin playbook to other corporate entities. He also recently proposed to Microsoft CEO Satya Nadella that he assist with his Bitcoin Strategy and generate an additional trillion dollars in wealth for Microsoft shareholders.
Signs of Overvaluation?
On Monday, October 28, the MSTR stock price rallied by an additional 8.96%, reaching its all-time peak of $255. Peter Schiff, a distinguished economist, also compared MSTR to gold mining enterprises during the gold rally.
Schiff compared MicroStrategy to gold mining companies, noting that despite MicroStrategy “earning nothing and producing virtually nothing,” its valuation exceeds that of all gold mining companies except Newmont.
Mads Eberhardt, an analyst at Steno Research, has observed that MSTR investors have experienced substantial gains; however, they should exercise caution in the future. Additionally, he asserted that the allure of holding the MSTR stock over ETFs will diminish due to the introduction of spot Bitcoin ETFs.
