U.S. States Boost MicroStrategy Investments by $302 Million

TLDR

• 14 states increased MicroStrategy investments by $302 million.
• California’s pension funds hold $276 million in MicroStrategy shares.
• MicroStrategy stock rose 37% year-to-date by May 2025.

In a notable shift in investment strategy, 14 U.S. states have increased their collective holdings in MicroStrategy (MSTR) stock. By using public retirement and pension funds, these states have allocated a total of $632 million towards the company’s shares. This represents a 91.5% increase from the fourth quarter of 2024, where investment figures stood at $330 million.

The involved states include California, Florida, North Carolina, New Jersey, Arizona, Wisconsin, Utah, and Colorado. These states have opted to gain indirect exposure to Bitcoin through MicroStrategy’s significant Bitcoin reserves. MicroStrategy has been a well-known Bitcoin advocate, making it an attractive option for investment funds looking to explore digital currencies without direct crypto purchases.

State Pension Systems’ Contributions

Several state pension systems have played notable roles in this investment. For instance, California’s State Teachers’ Retirement System acquired 336,936 shares, marking an 18% increase. Additionally, the Public Employees’ Retirement System in California grew its shareholdings by 35%, reaching a total of 357,183 shares and a valuation of $276 million.

Similarly, Florida’s State Board of Administration boosted its holdings by 38%, totaling an $88 million stake. North Carolina’s Treasurer increased its share count by 41%, reaching 107,925 shares valued at $43 million. Other significant contributors include New Jersey, Arizona, Wisconsin, Utah, and Colorado, collectively increasing their holdings as well.

Shift Towards BTC Proxy Assets

The decision to invest in MicroStrategy stocks comes as the states’ pension funds explore Bitcoin proxy assets without directly engaging in cryptocurrency. This preference was highlighted when Wisconsin recently divested from BlackRock’s iShares Bitcoin Trust, reallocating $300 million into MicroStrategy. This strategic move signals a growing inclination towards companies with significant Bitcoin reserves over traditional Bitcoin ETFs.

The trend indicates a broader institutional pivot towards embracing Bitcoin as part of their treasury strategies, albeit indirectly. This shift aligns with MicroStrategy’s aggressive Bitcoin acquisition strategy, which includes its efforts to raise funds through convertible notes, as seen in a previous offering of $600 million.

Market Implications and Observations

As a result of these substantial investments, MicroStrategy’s stock has seen a 37% rise year-to-date by May 2025, with prices reaching up to $430 before experiencing some volatility. No direct effects on Ethereum or other altcoins have been observed; the focus remains primarily on Bitcoin due to MicroStrategy’s Bitcoin holdings.

Julian Fahrer, founder of Bitcoin Laws, remarked on social media about the significant increase in state-level investments. He shared, “A collective increase of $302 million in one quarter,” highlighting the fast-paced changes in how these funds are allocated. He also emphasized the noteworthy move by Wisconsin to shift away from Bitcoin ETFs.

Past and Potential Investments

Historically, states like Wisconsin and Michigan have shown an interest in Bitcoin ETFs and MicroStrategy proxies. Research by VanEck suggests there is a potential for $23 billion in state-level Bitcoin acquisitions. This figure further indicates the growing trend and possibility for future investments by state funds into similar assets.

MicroStrategy’s ongoing commitment to expanding its Bitcoin holdings, supported by initiatives like their digital asset treasury management efforts, underscores the company’s strategic positioning in this evolving market landscape.