I just saw a link to this WSJ article about bitcoin (it's behind a paywall unfortunately), which mentions that MSTR is selling bonds in order to buy bitcoin. They're actually taking on debt in order to increase their bitcoin holdings, which I find to be incredible. Again, I have no clue what their shareholders think about this, but it's a massively ballsy move to do that--that CEO is obviously so bullish on bitcoin that he's betting on it going up much more than whatever interest those bonds pay. And man, for his sake I hope he's right. If bitcoin were to suddenly tank, I'm pretty sure there would be some kind of shareholder revolt.
I mean it's a pretty safe bet as long as they have cash flow to pay the interest. I think the interest rate was set at 6.xx%. And bitcoin on average goes up by 100+% a year the past 5 years, and considering it just dropped 50% it's a great time to do this sort of thing. Apparently there was like $1.5 billion trying to buy in, but Saylor limited it to $500 million in order to be able to handle the interest payments.
I do note that the last time they raised money for buying Bitcoin there was literally no interest paid out on it. I think Saylor is probably getting close to the end of his Bitcoin buying sprees if they went from paying no interest to paying 6+% on this one. They've got the $1 billion equity sale over time that they filed for which they plan to use partially for Bitcoin buying as well. I wouldn't be surprised if some of that equity sale will be used to have an emergency fund of cash to cover interest payments so they don't have to sell any of their Bitcoin and let their balance sheet just keep ballooning. I'm guessing that'll be the last of their big bitcoin accumulation buys, though I'm sure they'll keep DCAing $10-$15 million at a time.
Is it publicly known how much Bitcoin or cryptocurrencies in general they are holding in total?
You can read this thread and find out.
They have 92k BTC and they have authorization to buy BTC with another $500 million (whether they have bought yet or not is still not clear)
They ONLY buy and hold bitcoin, so fuck off with your asking about cryptocurrencies, they do not buy shitcoins... hahahaha.. nothing personal against you, fulcare.
Michael Saylor (and thus MSTR) is a newbie to bitcoin, so again you might want to study this thread in regards to the situation, and surely he is an interesting case in terms how quickly he studied the matter, how BIG he went in from the start in August 2020.., how much publicity he has been getting, some of his ongoing doubling down in terms of his buying of bitcoin and how much he seems to be ready, willing and able to share his strategies including giving free seminars on the topic of how to buy BTC (and put BTC on the treasury balance sheets) for BIGGER players.
Of course, "early adopter" is a relative term, so how the hell is anyone going to know for sure except with the passage of time in regards to how matters turn out.
Of course, the theory is that we remain in relative early stages, and so MSTR seems to be of this mindset in terms of considering how advantaged that they could become to attempt to front run BTC investing and in that regard to have a lot of advantages over other players who are either too slow to act or too non committed in terms of recognizing BTC's current value proposition.
They might be correct, and they might not. Surely, many regular bitcoiners believe that they are both right and quite smart to be attacking the matter quite aggressively in such a short period of time. With the passage of time, we will see how well their aggressive approach works out for them.
Seems that they are probably right, so then anyone studying the situation, whether an individual or an institution has to decide if the behaviors of MSTR is going to affect their own thinking about the matter. If MSTR is trying to buy all the bitcoins, then there might be some considerations about whether to emulate or just step back and let them buy them all or take some moderated stance to accumulate a sufficient amount of BTC in order to feel comfortable with the possibility that they could be right - or on the other hand, be prepared in case they might not be correct...
I would imagine that quite a large number of regular forum members have been preparing for BTC prices to go up for some time, so the behavior of MSTR is not totally shocking, even if it seems to be way more aggressive than even the most bullish of bullish members here.... Many times regular peeps do not have cashflows that are great like MSTR nor are they in a position to either leverage a company or to gain publicity for such leverage, so in that sense the behavior of MSTR ends up fitting in a special category that might not be the same as what longer term forum members had been capable of doing, but there likely are a decent number of longer term forum members who feel adequately prepared psychologically and financially for MSTR's seeming ongoingly aggressive approach to BTC.
You are speaking gobble-dee-gook like some kind of butt hurt no coiner who doesn't know shit but wants to spout out some kind of out of touch theory.
I will admit that the behavior of Microstrategies fits into a kind of difficult to believe category, but if we are attempting to categorize the behavior and talk about the BTC price effects that it may have, we should be attempting to stick with reality rather than just making up shit that makes hardly any sense.
Another matter is that it seems to be difficult to know whether MSTR bitcoin buying is having much if any affect on short term BTC price. Of course, any entity that continues to buy is going to put ongoing pressures on the buy price, but if others do not follow or if the selling (or even the use of financial instruments to short) are stronger than the buying pressures, then of course the BTC price will continue to go down, even if Saylor et al might be buying BTC in lump sums and even 10s of millions of dollars worth regularly on a monthly or so basis.
I would not proclaim to know whether $30,066 is our actual bottom for this particular correction or if there might be more room for more downity. Looks like we are getting another test of buy support, and sure it is possible that MSTR has already bought.. but really difficult to know, especially if they have not yet announced. At some point, I would consider that Saylor/MSTR would want to be a bit more strategic about their buys in terms of buying on dips - because at some point they must appreciate that they are HODLing a sufficient amount of BTC to prepare for UP... so in some senses they can help the whole ecosystem and themselves to be buying on dips, too... rather than just buying at whatever the BTC price happens to be at the time - which is what is recommended for a smaller HODLer who is still establishing base BTC accumulation levels - and so it should be logically apparent that even having had accumulated 92k coins or even perhaps over 100k coins by now, MSTR has accumulated a pretty decent base of coins relative to other assets that they might hold or even some cash that they may continue to have available besides the cash that they have borrowed, equity that they have reserved or other cash that might be coming in based on ongoing sales (that are likely to be continuing).
Ugh, thanks for your detailed response!
Believing Saylor that he only recently found out and got involved with crypto is naive if you ask me. I would rather think he personally already loaded his bags and then went all in on it publicly, too. A guy in his position is unlikely to only have found out about Bitcoin in 2020 if I got you right here. If you plan to go public with your buying strategy like Saylor did, it is more likely that he had a few big wallets already.
When I said cryptocurrencies, I am not referring to small and cheap shit coins, but I thought they may also have minor positions in coins like Ethereum, maybe a hand full of others. Anyway, they aren't just talking obviously, they are real about it.