The "Crypto Twitter" arena is always buzzing: Changpeng "CZ" Zhao, co-founder of Binance, lays out some basic calculations for four-time kickboxing world champion Andrew Tate.
After the stormy market waters calmed, Michael Saylor and his company MicroStrategy delved back into buying Bitcoin (BTC). This time, the American tech company acquired 10,624 Bitcoins after the price of Bitcoin bounced off a support level of $85,000 to reach $90,000.
However, prominent figures in the cryptocurrency industry did not seem impressed with Bitcoin's price movement after this action that was supposed to be "bullish." Andrew Tate, a kickboxing champion and well-known social media influencer, posed this question on his X account: "I am a strong supporter of BTC, but MicroStrategy buys 10,000 Bitcoins in a single day and the price doesn’t move," urging his audience to provide an explanation for that.
CZ solves Bitcoin riddle for Andrew Tate
Changpeng "CZ" Zhao, co-founder of Binance, quickly intervened to provide his reasoning behind the lack of clear impact on Bitcoin's price.
CZ clearly explained that MicroStrategy's latest Bitcoin acquisition constitutes just 1/2000, or 0.05%, of the total market cap of Bitcoin. This rarely leads to an immediate price spike, as Bitcoin is a liquid asset with a market cap of $1.85 trillion (at the time of writing).
>> CZ's response on X: "Typically, buying 1/2000 of market cap doesn’t cause much of a ripple. Bitcoin is a liquid asset."
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The purchase made in early December pushed nearly $90.6 thousand per coin for 10,624 Bitcoins. This raises MicroStrategy's cumulative reserve to 660,624 Bitcoins, which represents about 3% of the total Bitcoin supply, capped at 21 million coins.
Attempting to move these assets valued at $60 billion in leading cryptocurrencies might be able to shift the markets, but Michael Saylor has repeatedly confirmed there is no intention to sell. With an average purchase price over time of $74,796, MicroStrategy is profiting from its Bitcoin reserves, having netted $11,428,549,264 since 2020.
Questions from the audience (additional insights from the article):
Q: What sparked the exchange between CZ and Andrew Tate?
A: Andrew Tate posted on X questioning why the Bitcoin price has hardly moved at all, despite MicroStrategy buying more than 10,600 Bitcoins (nearly $1 billion in a single day).
Q: What exactly did CZ say?
A: CZ clarified that the $1 billion represents only about 1/2000 of Bitcoin's total market cap and approximately 0.05% of the circulating supply. He also noted that traders execute such trades through OTC desks, thus they do not enter public buy and sell order books in the first place.
Q: Why hasn't the Bitcoin price risen noticeably?
A: Large institutional purchases like MicroStrategy are typically handled privately through OTC (over-the-counter) desks that match buyers and sellers away from exchanges, absorbing this trading volume without causing large "green candles" on retail trader charts.
Q: What is MicroStrategy's current Bitcoin inventory?
A: After the recent purchase, MicroStrategy owns over 660,000 Bitcoins, valued between $65 and $70 billion at current prices, making it the largest institutional holder by a significant margin.
Q: How did the crypto community react?
A: Most of the community praised CZ for his calm and educational response. Many said it was a perfect "welcome to the real markets" moment for Tate and new investors who still expect every large purchase to result in an immediate vertical price increase.
