The rapid growth of bitcoin treasury companies has created what some observers have dubbed an ‘infinite money glitch’ in financial markets. These publicly traded companies, most notably Strategy (formerly MicroStrategy), have discovered a seemingly perpetual cycle of raising capital to buy bitcoin, watching their stock prices soar as bitcoin appreciates, then using their elevated valuations to raise even more capital.
Bitcoin treasury companies are fundamentally different from traditional corporations. Rather than generating revenue through operations, they function as leveraged plays on bitcoin’s price appreciation. Strategy exemplifies this model, having purchased more than 630,000 bitcoin as of September 2025 (now valued at over $70bn) while its stock price has surged over 1,000% since this time two years ago.
These companies operate by holding substantial bitcoin reserves on their balance sheets, financed through debt and equity issuances that create direct transmission channels between crypto market volatility and traditional financial markets.
The mechanics reveal interesting financial engineering, reliant on circular or even counterintuitive logic. Companies issue stock to purchase bitcoin and, as bitcoin’s price rises, their treasury holdings increase in value, driving up their stock price, often at an amplified rate in relation to the underlying dollar-denominated gains in their treasury holdings. This enables them to issue more stock at higher prices, creating a self-reinforcing flywheel effect.
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