Matt Cole, CEO of Strive (ASST), a company that strategically acquires Bitcoin, stated that the most crucial variable determining the overall yield of the BTC treasury strategy is the ‘amplification ratio’. He explained via X, “Our own model analysis shows that over 99% of the change in total returns is explained by the amplification ratio, and the impact of capital costs is much more limited than the market believes. Strive aims for common shareholders to achieve higher returns than directly holding BTC. We plan to increase the amplification ratio to over 60% by the end of the year, which requires strong fundraising capabilities, sufficient liquidity, and continuous investor confidence. As the price of BTC rises further, the capital needed to achieve the goal also increases, potentially raising the difficulty.” The amplification ratio is a measure of how much preferred stock and debt a company utilizes relative to the value of the BTC it holds.
