Crypto industry veterans and investors are debating whether Bitcoin (BTC) or MicroStrategy (MSTR) is a better buy following several weeks of stellar performance for both assets.

Since the start of the year, Bitcoin has rallied 54% on the back of massive demand for newly launched Bitcoin ETFs, whose shares have appreciated at the same rate as the underlying coin. MicroStrategy, however – the company owned by Bitcoin billionaire Michael Saylor – has risen 155% in that same time.

Comparing Bitcoin to MicroStrategy

MicroStrategy is the world’s largest corporate holder of Bitcoin. The asset comprises virtually all of the company’s balance sheet, which today carries 205,000 BTC – nearly 1% of all BTC that will ever exist.

Many including Saylor himself have likened the company to a Bitcoin spot ETF with the advantage of having no management fee. Proponents, however, note a slew of other advantages – namely its ability to deploy cheap, long-term debt to gather more BTC.

“Every time MSTR does a leverage buy on cheap financing the valuation will boost, so its already acting like a levered BTC long,” explained Bitcoin analyst Willy Woo in an X post on Thursday. These purchases effectively boost shareholders “BTC per share,” a metric that stays essentially flat in standard Bitcoin ETFs run by BlackRock and Grayscale.

Such debt is also far cheaper than what normal people can access.

While the Federal Reserve’s benchmark rate currently exceeds 5%, and crypto markets are lending stablecoins at over 10%, MicroStrategy’s latest convertible note sales offer a mere 0.6% and 0.8% interest rate. The debt on both loans – which are cumulatively $1.2 billion – isn’t due to be paid back until 2030.

Bitcoin OG Adam Back says MSTR has other methods of acquiring more BTC, including selling bonds, or selling more company shares. The latter method is effective at reducing the company’s debt ratio, and has even proven to increase shareholder’s BTC per share.

“Between now and hyperbitcoinization can they double the BTC held and more? answer I think, yes probably,” he wrote.

Advantages of Real Bitcoin

Like any company, MicroStrategy still carries corporate risk next to actual Bitcoin, since management may choose to change directions on its Bitcoin strategy. Some part of its valuation is also based on its pre-existing software business, which isn’t guaranteed to be profitable in the future.

Since the start of the year, Saylor has been selling his shares in MSTR to purchase more BTC, which critics view as a lack of conviction in his own company compared to Bitcoin itself.

“If Saylor thought MSTR was a good investment, hed be doing stock buybacks instead of selling it to buy more bitcoin,” wrote Pledditor on Friday.