Flashback to 2013: Bitcoin at $93 in Daily Reckoning
Adam Sharp

I was recently browsing through the Daily Reckoning archives and stumbled across a March 2013 piece by our long-time contributor Jeffrey Tucker.

The article was titled “Bitcoin’s Moment”, and BTC was trading at $93 at the time.

Here’s an excerpt:

“Many people fear that Bitcoin is overpriced right now. This view is held even by people in the Bitcoin community who worry that a move from $15 to $93 in three months is not good for long-term viability. A crash could bring down the currency unit in devastating ways, leading to another round of debunking and clucking from the advocates of government money.”

It’s fascinating to see this discussion in retrospect. And it’s true that many thought Bitcoin was overvalued at the time. It had just increased 6x in three months. Calls of “bubble” had already begun.

Coinbase had just recently launched, and hadn’t yet established itself as a major player. The market was still searching for its first big and reputable Bitcoin exchange. Most of the operators at the time were questionable.

But Tucker was bullish.

“Maybe the price will keep climbing. Next month at this time, people might be kicking themselves for not getting in right now. My instincts right now tend in this direction. I’m seeing BTC at $250, then $500, and then $1,000 by year-end.”

Jeffrey’s prediction of $1,000 Bitcoin by the end of 2013 came true. In late November Bitcoin briefly surpassed the key psychological barrier of $1k.

Bitcoin has come a long way since then. Today it trades over $100,000 as I write this. It has become a force in the financial world.

Kudos to Jeffrey Tucker for having the foresight to see it coming, and sharing it with our readers.

But while Bitcoin itself continues to dominate headlines, one company’s bold (dangerous?) strategy has captivated Wall Street and Main Street alike…

The Curious Case of Microstrategy

Microstrategy (MSTR) has been grabbing a lot of headlines recently. The company has raised huge amounts of convertible debt to purchase Bitcoins.

So far they’ve bought an incredible 576,230 Bitcoins, for a total value of about $62 billion at $108,000 per BTC (as of 5/21/2025). Their average purchase price is around $66,000.

The curious part is that Microstrategy stocks currently have a market cap of $114 billion, and only have about $62 billion worth of BTC.

The underlying company isn’t worth much, perhaps a few billion. It’s basically just a vehicle that raises debt to buy Bitcoin. So why are they trading at almost 2x the value of the Bitcoin the company holds?

Previously, I would have explained this by the fact that Bitcoin ETFs were unavailable, so people are just looking for a stock to play it. But that explanation no longer flies with the widespread availability of cheap ETFs.

Now I think the market has simply gotten ahead of itself with regards to MSTR. It’s overvalued compared to Bitcoin at this point. Those who want to buy Bitcoin in a stock account should just buy the Fidelity (FBTC) or iShares (IBIT) ETF.

If Bitcoin has a significant correction, MSTR will likely move sharply lower. And I don’t see it outperforming the underlying cryptocurrency going forward. Not worth the risk.

The Trump Factor

Trump’s victory has been fantastic for the cryptocurrency sector. Gary Gensler, the anti-crypto SEC head, resigned in disgrace and there’s a new crypto-friendly sheriff, Paul Atkins, in charge now.

Trump has announced that he will create a US Bitcoin Reserve Fund, consisting of the 200,000 confiscated BTC owned by the federal government. Those are coins that would have otherwise been sold into the market, so this alone will have a significant impact. It’s possible that Trump decides to purchase additional Bitcoin in the future, but this doesn’t seem very likely.

Most importantly, Trump has ended the crackdown on crypto companies, which has been a major problem during the Biden administration. During Biden’s term, companies and individuals involved in the crypto space were being denied banking services through a dark program called “Operation Choke Point 2.0”.

But all of that is over now. President Trump is unabashedly pro-Bitcoin and cryptocurrency.

With Moody’s recent downgrade of America’s credit rating, soaring US debt and deficits, and a mega-QE money-printing spree likely in the near future, the stage is set for a continuing bull market for Bitcoin.

Needless to say, it will be a volatile ride. But the profit potential remains high. We’ll check back in on Bitcoin in a future issue.

Adam Sharp has been a financial writer and Fed watcher since 2008. He is a contrarian who specializes in non-traditional assets. Adam founded and sold Early Investing, a newsletter about alternative investments. Sharp lives in Maryland with his wife, two children, and two dogs.

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