Topic: MicroStrategy Buys $250M in Bitcoin, Calling the Crypto ‘Superior to Cash’ - page 11. (Read 19150 times)

You might be correct in terms of an implication that there could be responsible ways of custodying bitcoin (and perhaps shitcoins too, to the extent that any of the "crypto assets" matter outside of bitcoin).    It seems that there are quite a few tools that are still being developed, and surely it could be the case that some custodians create their own tools and checks/balances to lessen the likelihood of losses (I would think that the risks could not be completely eliminated, and I think that there should be reasons to be worried.. and surely I am not claiming to be any kind of expert beyond being a bit scared on behalf of others - not that some of the losses through various 3rd party custodians would necessarily be reflected of the safeguards that might be taken with some of the current custodians... and yeah, I hear about all kinds of potential solutions that include multi-sig and multi-jurisdictional protections, yet I can hardly imagine if there might not be some potentially BIG incidents that might end up happening - and yeah sometimes there might be cover-up involved too, so we might not hear about "incidents" as they are happening.

I don't know exactly how it is, but in the fund industry, both indexed and mutual, and this includes pension funds, they have a separate custody part and I don't remember there being any major problems with it. We are talking about quite a few trillions.

I have a certain level of doubt that whatever insurance that the various custodians supposedly have in place is anywhere close to adequate in terms of really covering the BTC that they hold, yet surely we likely appreciate that the insuring of bitcoin and the custodying of bitcoin and other kinds of digital assets (maybe including shitcoins) remains an evolving kind of a service that could end up playing out quite painfully if there really ended up being large scale disappearances of bitcoin holdings (or other ways that custodians might end up losing access to the coins that they are supposed to be holding). 

Well, as you may know, they do it because there are many more people who can afford to buy a couple of $130 shares than $1,300, apart from the psychological effect that makes them look "cheaper" even though they are not.




Arkham Intelligence identifies MicroStrategy Bitcoin holdings pooled with Fidelity


From our point of view as individual holders it is probably hard for us to see it, but for companies it makes more sense to have the Bitcoins in the custody of a company with a specialized custody service that they can sue if they lose them or something. Those services, apart from a lot of security measures, will have an insurance for those issues.

I'm surprised MSTR stock got split 10:1, just seeing as how so many other stocks don't seem to be splitting these days.  I know it's absolutely neutral as far as any statistics are concerned, but 20 years ago you wouldn't usually see a bunch of NASDAQ listings getting anywhere near $1k, which is what I'm observing not only with tech stocks but many others as well.

Didn't see any mention of the split in this thread, so I thought I'd bring it up. 


If it's true they keep their private keys off of Coinbase or wherever they trade, I'm curious as to how they keep them secure--not that I expect that to be revealed, of course; I'm just curious.  They've got a lot of bitcoin to keep an eye on.

If I remember correctly MicroStrategy uses Coinbase for order execution,yet custody I guess they do self custody.
No wallet has been tied to MicroStrategy, this leads me also to the self custody solution: they have more sofisticate way of assessing their balances rather than resorting to a single address to be monitored onchain.

Ultimately, Saylor's/MSTR's approach has been quite genius in terms of making sure to be out there and really selling their strategy right from the start. So in that regard, everyone and anyone had chances to follow some similar version of the Saylor/MSTR playbook - even though surely hardly no public company would have had the ability to carry out the strategy in such a seemingly psycho way as Saylor/MSTR, partially based on the way that public companies tend to be set up with a bit more scattered control...

There have also been several areas in which some folks had considered that Saylor/MSTR had gotten overly leveraged in bitcoin, yet they had never gotten into places in which they did not have enough cashflow to service various debts that they had, so the kinds of leverage that they had tended to be fairly easy to service - with no real harsh terms.. but maybe there was a bit of luck too in terms of chosen custodians of bitcoin and chosen debt servicing relationships, since so many custodians and banks had issues in the 2022 collapses - and we did see some relatively BIG entities suffer extreme losses based on their chosen custodians and bank relations... 

I would be nervous if I were Saylor/MSTR if I were to have more than 50% of my holdings with ONLY 1 custodian, such as Coinbase, and so I continue to wonder how solid are whatever custodian arrangements that Saylor/MSTR has.. Oh yeah and by the way, Saylor has more liberty in regards to how to hold his personal stash, which seems to be at least more than 17k bitcoin that he announced publicly, and would imagine that he personally has more than 25k bitcoin since he had sold so many personal shares of MSTR last year-ish, and he's gotta put that value somewhere.

I think part of Saylor's big scheme is to convince other companies to follow in his footsteps.
Some have already started, in small steps, following the same playbook as the “Bitcoin Magazine owned" firm Metaplanet in Japan, while others have made vague announcements.
As we often say: “Slowly at Start, then suddenly”

In just four years, Bitcoin has empowered @MicroStrategy to rise above the competition.

Michael Saylor⚡️




I doubt this would have been possible without Saylor's fanatical belief in Bitcoin. It could be said that this opportunity was available to everyone, but for some reason only MicroStrategy were able to take advantage of it. Now imagine that in the near future bitcoin on the bullrun will reach 100k, but this will be the limit of possibilities for bitcoin and for Sailor, because he says that he is not going to sell bitcoin, but will continue to hold it.

So, we were all wrong in considering  MSTR as a BTC ETF.
An ETF has a constant (actually, slightly diminishing) amount of Satoshi under control, while a single MSTR has an augmenting number of controlled sats.
Of course this metric is very interesting and definitely the number to look at.
Still, the over structure of the simple holding is too cumbersome, in my humble opinion.

$MSTR's BTC per share continues to climb, reaching a new high this quarter.

This is probably the most important metric to judge the success of MicroStrategy's Bitcoin acquisition strategy.



source

In current developments MicroStrategy has had great success in their journey with bitcoin. The steps taken by Saylor have attracted great attention from Bitcoin investors because the steps taken by Saylor are buying and holding, currently their BTC holdings have reached 226,500 BTC.

This BTC Yield is the most interesting passage of the press conference.
I have read a Linkedin post about it:

source

MSTR Second quarter financial results
https://www.microstrategy.com/investor-relations

Microstrategy introducing a BTC Yield KPI. So a net increase in bitcoin per share after any share dilution. Target is 4-8% per year for 2025, 2026, 2027. YTD shareholders already seen a 12.2% increase in their bitcoin/share.




There is a second best:

Isn't it a bit ironic how some longer term guys here might look at the acquisitions of MSTR and then consider that MSTR is acquiring in the ballpark of the total of an OG Bitcoin's stash in a month (and that was a relatively small month for MSTR), or maybe MSTR's monthly acquisition is in the ballpark of 2x of an OG bitcoiner's stash..

And at the same time, there is some likely appreciation that perhaps after this next bull run, MSTR might be describing the acquiring of less than 50 BTC in a month and proclaiming that purchase to have had been a decently large monthly acquisition...

Even if 50 BTC might not be $50 million soon in the future, it may well be $10 to $20 million within this cycle or perhaps within the next cycle.. but surely better to keep your value in bitcoin rather than in dollars (or trying to trade in and out of BTC with any kind of great expectation to be able to buy back BTC cheaper - even though surely sometimes the sales on the way up might end up working out to be able to buy back more BTC at lower prices.  

I frequently suggest that it surely is not even close to guaranteed to be able to buy back Bitcoin at lower prices than the sales price, so each of us needs to be careful with the quantity of BTC that we are selling at various prices that we consider to be toppy, even if we might have had some success in the past with that (not that you (LFC) were expecting to necessarily be able to buy back cheaper, so surely I am not specifically talking about your case).. even though surely you realize that I already subscribe to a kind of philosophy of ongoing selling of BTC on the way up (especially once we have overly accumulated) in order that we do not end up getting too emotional about how the dollar value of our BTC stash has gone up and if we might feel that we are ONLY seeing such dollar value "on paper" rather than in our real world abilities to purchase hookers, lambos and blow.  

Surely, MSTR / Saylor has a bit of a different philosophy in terms of never selling any of his (or his company's) BTC, and even acquiring at % of networth (% of investment portfolio) levels that seem quite excessive as compared to what normal individuals would be able to tolerate. and surely for Saylor himself (having 4 yachts and at least a couple of mansions), he is likely not anyone who is short of cash or abilities to support himself or to live comfortably outside of his bitcoin holdings - even though if sometimes he seems quite extreme in his bitcoin accumulation.. not just quantity but percentage of his networth (investment portfolio).

@saylor
In July, @MicroStrategy acquired an additional 169 BTC for $11.4 million and now holds 226,500 BTC. Please join us at 5pm ET as we discuss our Q2 2024 financial results, the outlook for $BTC, and our #Bitcoin development strategy. $MSTR

https://t.co/cfGPc42jfM
https://x.com/saylor/status/1819102944744161537

https://finbold.com/george-soros-just-updated-his-stock-portfolio/

MSTR is the corporate triple maxi strategy.
https://www.youtube.com/embed/O9KnBcWMkpw?start=1280&end=1630

Berkshire has B shares for that very reason (which are a lot more liquid than the A shares). There are as well exchanges out there that don't allow buying fractions of shares making it harder for the little guy to own some. Saylor expects bitcoin to do at least a 10x from today, which makes the shares even more out of reach when not split. Together with the option trading argument I think splitting the stock makes perfect sense.

Maybe we learn some more during next announced financial results for Q2 (Thursday, August 1st, 5-6pm ET):
https://microstrategy.zoom.us/webinar/register/WN_4PO93A4dRuimg1b-4bRcUQ



Edit: https://seekingalpha.com/article/4704081-microstrategy-stock-split-upside-is-potentially-enormous

From a perfectly rational point of view, there are no differences before and after a stock split.
Instead of having 1 stock at 1000 you have 10 at 10.
There is only a perception of lower valure of the stock itself. So more buyers might be interested.

There are companies that never did a stock split (Berkshire Hataway). The reason is simple: they don't want as a holder someone that believes you can create value for the enterprise with a simple mathematical operations.

I am confused too (I not proclaiming that you are necessarily confused in the exactly same kinds of ways that I am, fillippone.. but I am just speaking in a "me too" kind of way).  

More specifically, I am not really into some of these kinds of stock trading matters, since I don't really fuck around with trading stocks... or using various financial instruments related to stock trading (or stock investing).. probably, I am more of an index fund kind of guy when it comes to stocks.. and so any of my specific kinds of investing and/or trades relate to bitcoin rather than stocks.. and we likely realize that bitcoin is not the same as stocks, but surely there are more and more financial instruments being created and utilized related to bitcoin in order to sometimes create some ambiguity in regards to the extent to which the bitocin might be owned directly or not and whether or not the bitcoin can be withdrawn from a third party's platform if there is a representation of ownership of the bitcoin..

In any event, I need some more explanation regarding the supposed differences of something like a stock split versus not doing the stock split.. and it seems that I had largely presumed something similar as what you (fillippone) had already written that the stock split was more of a perception of cost matter, and that the stock split had no other significant and/or material change in meaning or value beyond creating a different perception of "unit value" by reducing the number of units.. so in this case creating 10 shares for every previously owned share (of 1).