Michael Saylor’s Strategy (MSTR, Financial) may be on track for a stunning Q2 paper profit of approximately $14 billion, driven by an unrealized, non-GAAP gain, which, if realized, would be categorized as non-recurring income from non-operating activities But unlike traditional titans, this isn’t driven by product salesStrategy is expected to post just $112.8 million in software revenue. Instead, the company’s leveraged bet on Bitcoin and a new fair-value accounting rule are fueling the projected profit spike. As of March 31, Strategy held over 528,000 Bitcoin, worth $43.5 billion at the time, with subsequent gains from rising prices and weekly purchases driving the total value even higher.

• Warning! GuruFocus has detected 9 Warning Signs with MSTR.

The dramatic shift comes just one quarter after Strategy posted a record $4.2 billion loss due to Bitcoin’s Q1 decline. The change in accounting, which now reflects market prices rather than historical cost, makes Bitcoin’s swings highly visible in earnings. While long-time critics like short-seller Jim Chanos (Trades, Portfolio) argue that Strategy trades at an inflated premium over its crypto holdings, Benchmark’s Mark Palmer maintains a bullish stance, suggesting that the market may finally be recognizing the value of Saylor’s approach. Strategy’s stock has surged over 3,300% since its Bitcoin journey began in mid-2020, far outpacing the 1,000% rise in Bitcoin itself.

Saylor’s approach has also inspired imitatorsfirms like Sharplink Gaming, Upexi, and BitMine are buying up other tokens like Ether and Solana. Whether these copycats succeed remains uncertain, but Strategy’s transformation from a fading software firm into the world’s largest corporate Bitcoin proxy has undeniably reshaped how some public companies think about treasuries. Lawsuits remain over alleged misleading disclosures tied to the first-quarter loss, and volatility continues to shadow the stock, but with second-quarter results due in August, all eyes are on how the market will digest Strategy’s bold evolution.

This article first appeared on GuruFocus.