A Bitcoin investment that can be held inside a Stocks and Shares ISA or SIPP

UK investors can’t buy Bitcoin ETFs for their investment accounts or SIPPs due to FCA regulation. This stock could be the solution.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Young mixed-race woman jumping for joy in a park with confetti falling around her

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

It’s fair to say that Bitcoin is in a strong bull market right now. This year, it has surged from $43,000 to $89,000 – a gain of more than 100% (of course, past performance is not an indicator of future results, and Bitcoin is highly volatile.) Now, UK investors can’t buy Bitcoin exchange-traded funds (ETFs) for their Stocks and Shares ISAs or SIPPs at the moment because they’ve been banned by the Financial Conduct Authority (FCA). But there is a stock that provides exposure to Bitcoin that can be bought for these investment accounts…

A Bitcoin stock?

The stock I’m talking about is MicroStrategy (NASDAQ: MSTR). It’s a US technology company that has been stockpiling Bitcoin in recent years.

At the end of September, the company held 252,220 Bitcoins. At today’s price of $89,000, that stockpile is worth about $22.5bn.

Should you invest £1,000 in Vistry right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Vistry made the list?

See the 6 stocks

It seems that UK investors are catching on to the fact that MicroStrategy is a play on Bitcoin (and can be held in tax-efficient UK investment accounts). Last week, it was the second most bought stock on Hargreaves Lansdown.

Anyone who bought the stock last week will be laughing today. Yesterday, the stock surged a whopping 26%!

Created with Highcharts 11.4.3Strategy PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.co.uk

Past performance is not indicative of future results. Also, please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

The business

Taking a closer look at this organisation, as it’s certainly interesting.

In the past, MicroStrategy was a business intelligence and analytics software company (it still offers these solutions today).

However, in 2020, the CEO at the time, Michael Saylor (who is now executive chairman), decided to start buying Bitcoin.

Today, the company is the largest corporate holder of the crypto-asset globally, and it says it’s the world’s first ‘Bitcoin Treasury Company’.

Our focus remains to increase value generated to our shareholders by leveraging the digital transformation of capital”, wrote President and CEO Phong Le in the company’s recent Q3 results.

The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of investment advice. Bitcoin and other cryptocurrencies are highly speculative and volatile assets, which carry several risks, including the total loss of any monies invested. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

High risk

From an investment perspective, however, I see it as high risk.

Right now, the company is not generating any revenue growth. Last quarter, revenue fell 10.3% year on year to $116.1m.

Meanwhile, it is also losing money. Last quarter, it posted a net loss of $340.2m, or $1.72 per share on a diluted basis.

On top of this, the company plans to raise a lot of money in the years ahead to buy more Bitcoin (it plans to raise $42bn over the next three years). This could dilute existing shareholders’ positions.

Of course, if the Bitcoin price continues to surge, the MicroStrategy share price is likely to rise as well. However, there are no guarantees that Bitcoin will continue to rise. And if the Bitcoin price was to slump, the MicroStrategy share price would most likely slump too.

So, investors really need to weigh up risk and reward here before investing.

My view

Personally, I won’t be buying the stock. For me, there are too many variables, and the risk level is too high.

But I can see the appeal of this stock. The fact that it can be held inside a Stocks and Shares ISA or SIPP is a huge plus as one can potentially profit from Bitcoin tax-free.

But this isn’t the only opportunity that’s caught my attention this week. Here are:

5 Shares for the Future of Energy

Investors who don’t own energy shares need to see this now.

Because Mark Rogers — The Motley Fool UK’s Director of Investing — sees 2 key reasons why energy is set to soar.

While sanctions slam Russian supplies, nations are also racing to achieve net zero emissions, he says. Mark believes 5 companies in particular are poised for spectacular profits.

Open this new report5 Shares for the Future of Energy — and discover:

  • Britain’s Energy Fort Knox, now controlling 30% of UK energy storage
  • How to potentially get paid by the weather
  • Electric Vehicles’ secret backdoor opportunity
  • One dead simple stock for the new nuclear boom

Click the button below to find out how you can get your hands on the full report now, and as a thank you for your interest, we’ll send you one of the five picks — absolutely free!

Grab your FREE Energy recommendation now

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Edward Sheldon has no position in any of the shares mentioned. The Motley Fool UK has recommended Hargreaves Lansdown Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

We think earning passive income has never been easier

Do you like the idea of dividend income?

The prospect of investing in a company just once, then sitting back and watching as it potentially pays a dividend out over and over?

If you’re excited by the thought of regular passive income payments, as well as the potential for significant growth on your initial investment…

Then we think you’ll want to see this report inside Motley Fool Share Advisor — ‘5 Essential Stocks For Passive Income Seekers’.

What’s more, today we’re giving away one of these stock picks, absolutely free!

Get your free passive income stock pick

More on Investing Articles

Investing Articles

Glencore’s share price is 53% off its 52-week highs. Is it time to consider buying?

Glencore’s share price has tanked due to concerns over an economic slowdown. Is this an amazing buying opportunity for long-term…

Read more »

Investing Articles

Forecast: in 1 year, the Marks and Spencer share price could be…

The Marks and Spencer share price has hit its highest point since 2016 after more than doubling under the new…

Read more »

Hand of person putting wood cube block with word VALUE on wooden table
Investing Articles

Down 34%, does IAG’s share price look an unmissable bargain to me now?

IAG’s share price had fallen a long way even before the latest market rout, but this may mean a bargain-basement…

Read more »

Investing Articles

Forecast: in 1 year, the HSBC share price could be…

The HSBC share price is approaching a 20-year high under its new CEO as he targets $1.5bn of savings. Here…

Read more »

Investing Articles

Forecast: in 1 year, the Barclays share price could be…

Barclays’ share price has more than tripled in the last five years as higher interest rates push up margins. But…

Read more »

Investing Articles

This FTSE 100 heavyweight’s yield is forecast to rise to 8% by 2027 and it looks 60%+ undervalued to me too!

This FTSE financial gem looks very undervalued to me and its yield is projected to rise to well over my…

Read more »

Middle-aged white man pulling an aggrieved face while looking at a screen
Investing Articles

An all-time low! Have 25% car tariffs wrecked the Aston Martin share price?

The Aston Martin share price is diving into uncharted territory after Trump levied 25% duties on all cars and auto…

Read more »

Investing Articles

Forecast: in 1 year, the Tesco share price could be…

Competitive fears are driving the Tesco share price down, but has the market overreacted? Here are the latest analyst forecasts…

Read more »