The bigger question, however, is how such a buying spree could impact the price of BTC going forward.
Terra’s plan to build up a sizeable BTC reserve is already being compared to the strategy Michael Saylor’s MicroStrategy follows. The US-based firm has so far accumulated BTC 125,051 (USD 5.3bn), making it one of the largest holders of bitcoin in the world. Despite that, purchase announcements by MicroStrategy have largely gone without any major market impact.
Since Terra’s initial announcement of the new plan on February 22, bitcoin has traded higher, and is currently up by about 16% since the announcement. Notably, gains were also seen on the day of the announcement, when BTC rose by more than 3%.
As traders know, however, it is hard to say whether the price changes have anything to do with the announcement or not. All we know for now is that the more BTC that is bought up and locked away, the less will be available for the rest of us on exchanges.
The best take on the situation so far was perhaps given by Bitcoin developer Rajarshi Maitra on Twitter when asked how bitcoiners can come to terms with the fact that “shitcoiners are doing the biggest bitcoin buy in history:”