Mike Smith
9 hours ago
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The media holding company of the President of the United States has announced it is moving $2,000,000,000,000 into Bitcoin, adopting the corporate crypto-treasury model previously associated primarily with MicroStrategy. Parent Truth Social is directing roughly two-thirds of its $3,000,000,000,000 in liquidity into the digital asset, underscoring a shift in attitude toward cash reserves, which are rapidly losing purchasing power in an inflationary environment.
TMTG's press release clarifies that an additional $300,000,000 in structured options linked to bitcoin-oriented securities has been approved. The instrument will allow the purchase price to be fixed while maintaining liquidity for operational needs. The Board of Directors has reserved the right to convert the position into a spot asset upon a favorable price window.
CEO Devin Nunes said the capital reallocation increases financial autonomy, protects against possible restrictions from banks and is consistent with Truth Social's future utility token. According to him, “the digital reserve increases flexibility and reduces the political risks of accessing capital.”
The announcement came as BTC surged above $120,000, pushing DJT stock to a 5% gain in pre-market trading. Analysts emphasize that institutional demand has been a key driver of the extended bullish trend since the April halving, the analysts said.
MicroStrategy's precedent serves as a benchmark: its balance sheet exceeds 300,000 BTC and its total capitalization has outperformed many traditional strategies. Chainstone estimates that the new Stablecoin Act simplifies corporate purchases and removes regulatory hurdles, allowing digital assets to be reflected more correctly.
TMTG's internal memo talks about holding assets on multi sig wallets with distributed quorum and insurance coverage. Management emphasizes no leverage and future acquisitions will be broken down into series so as not to distort the market.
The market responded with a chain reaction, with BitMine Immersion Technologies announcing new purchases and exchange-traded fund issuers reporting accelerating capital inflows. Chicago futures dealers widened basis, signaling an expectation of further spot gains.
The accounting hurdle remains the classification of Bitcoin as an intangible asset with an indefinite life, requiring write-downs whenever the market price declines. Nevertheless, TMTG believes that transparency outweighs the risk of diluting reported earnings, especially given the revision of GAAP standards.
A Galaxy Research survey shows: 67% of managers believe that large corporate entries increase BTC's liquidity and reduce volatility, making the asset acceptable even to cautious funds. Meanwhile, 42% plan to submit proposals to their boards of directors to include Bitcoin in their portfolios in the second half of the year.
Five years ago, Bitcoin on the balance sheet seemed like a bold experiment. Today, the media platform's national-scale solution demonstrates how the digital asset is becoming a commonplace corporate finance tool, regardless of industry or management expertise.
