Michael Dell, founder and CEO of Dell Technologies, has sparked interest with a cryptic message hinting that his company might consider Bitcoin as an investment.
On June 21, Dell tweeted, “Scarcity creates value,” a phrase often associated with Bitcoin due to its limited supply of 21 million tokens.
This tweet caught the attention of Michael Saylor, a well-known advocate for Bitcoin as a corporate treasury asset.
Dell’s repost of Saylor’s reply, along with an image of Cookie Monster eating Bitcoin, fueled speculation that he might invest in the cryptocurrency in the future, either personally or through his company.
This potential Bitcoin investment follows Dell’s recent financial activities, which provide a solid foundation. Dell Technologies’ stock has nearly quintupled since its return to the public market in December 2018.
Over the past 18 months, the company’s Class C common stock surged from $40 to $145 per share, increasing Dell’s net worth to around $120 billion, making him the 14th richest person globally.
In 2024, Dell has already cashed out $2.1 billion while retaining 58% of the company’s ownership.
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This means he has substantial capital available to invest in Bitcoin, especially given concerns about rising U.S. debt and its potential impact on the dollar’s value.
Joe Consorti, an analyst at the Bitcoin Layer, a global macro research firm, believes Bitcoin could benefit companies like Dell Technologies, which might have excess cash due to cost-cutting artificial intelligence technologies.
He stated, “Outsized returns on their reserves during this AI boom will provide a further buffer for capital allocation during a time when spending and scaling in computer manufacturing haven’t been this rapid or hotly contested in decades.”
“Dell is sitting on $5.83 billion in cash to make that happen,” he added. Holding even a small percentage of the balance sheet in Bitcoin—say 1%—could give companies a significant edge over competitors.
For instance, if Dell Technologies allocated 1% of its $5.83 billion cash reserves to Bitcoin, amounting to $58.3 million, this investment could potentially grow to $118.7 million in a year, based on Bitcoin’s historical annualized returns of approximately 103.5% over the past decade.
Historical data suggests that corporations can greatly benefit from Bitcoin investment. For example, Saylor’s MicroStrategy has profited about $6.33 billion from its Bitcoin acquisitions in recent years.
Top investors like Warren Buffett have avoided Bitcoin, but hypothetically, even a 1% allocation to Bitcoin could have significantly boosted returns.
Consorti noted, “Bitcoin is the single best asset to position yourself in for outsized risk-adjusted returns over any multi-year timeframe.
‘You’re simply not working in the best interest of your shareholders if you ignore this without reason.”
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