Topic: MicroStrategy Buys $250M in Bitcoin, Calling the Crypto ‘Superior to Cash’ - page 45. (Read 14269 times)

They are unstoppable.

MicroStrategy Plans $400M Raise; Net Proceeds Will Fund More Bitcoin Buys

Full statement





I start questioning MicroStrategy nature here. What are they? A software company or a bitcoin hedge fund? I never saw anyone issuing debt to buy...their treasury asset.
It make sense to be a bitcoin hedge fund, but let’s make it clear for all your stakeholders.

Regardless of how we feel about them, they are one of the biggest OTC brokers in the west, and they are highly focused on regulatory compliance and licensing, which may be attractive to a large public company. I wouldn't expect past exchange outages to factor into this type of decision since it would obviously be matched OTC.

I cannot really agree with your characterization that I bolded above, Harriti.

Sure there are some major financial institutions in the USA that are getting on the bitcoin bandwagon.. but surely a quite minority--- but even with a minority of financial institutions entering into bitcoin, that is likely to have a quite bullish effect on BTC prices - absent some anomalies along the way.

So, yeah, surely this contagion is bullish for bitcoin prices.. and likely going to continue to have snowballing effects - even though we cannot presume that the price movement and the trend is "in the bag" or guaranteed - even though odds and the set up look quite wonderful for both BTC HODLers and any new entrants into the space... who might be able to front run some of the anticipated ongoing BTC accumulation momentum that seems to be taking place.



Well the poor better get their fucking shit together and start buying bitcoin.. otherwise, you are correct they are going to have to pay higher prices.  This is an informational matter, not a matter of how much money that anyone has.. of course, the more disposable income that anyone has, the better they are able to benefit, relatively speaking.

There are likely going to be plenty of poor (*or not very rich folks) who end up benefiting from this ongoing transfer of wealth, and those who are informed and start to actually act on their information are going to benefit the most, relatively speaking... and sure there are a lot of normies who either are not informed or they are NOT acting with the information because of whatever reasons, including some of them believing nonsensical thoughts that seem to kind of be contained in your post, 7788bitcoin, suggesting that it might be too late.. blah blah blah..

If you look at that concept of capitalist then only the rich will be investing in bitcoin considering the price keeps on rising and you cannot expect poor people to invest in bitcoin expecting them to use it as a currency. It is a fine line if you consider things on that aspect and anyone who invested in it from the beginning can earn a huge profit.

When the market is rallying we hear all the positive news and that is the same during the last rally and hence it is not a big surprise after all .

This is a sign that the price of Bitcoin will soon surpass the $ 20k price point towards a new much higher ATH. The major financial institutions in the US now no longer seem interested in foreign exchange, their truth is Bitcoin and they are investing more and more money in Bitcoin.
Maybe they will create a new trend in this Crypto market by pushing the price of Bitcoin even higher, maybe we will see Bitcoin at 30k $ early in Q2 2021.

They did it again:


https://twitter.com/michael_saylor/status/1334990791496884224?s=20

Here a brief recap of their holdings: they bought very close to the ATH, still they are 60% in the money!



[LINK]


EDIT: Added this recap in OP.

There should always be an analyst in the big company. A company like micro strategy will never take a big decision like that without tried to analyze the potential of bitcoin in the future.
1 thing that i know about the bitcoin if bitcoin has limited supply and this gives a clue for the future of bitcoin.
no inflation and that will become a rare thing in the future.

Honestly that is the one greatest thing they have done that could put them on the map.

Microstrategy was something not that many people heard of, sure there were some people who heard of them but it wasn't really a huge number, but ever since they got into crypto they are the talk around the crypto world and also in the financial world all at the same time.

This is both looks to be promising and profitable move by them but also a great PR move by them at the same time, I doubt there was anything in the world they could have put their money into that could have profited them this much, but also it wouldn't create the recognition they created neither, this looks to be something awesome for them.

When someone invests this much into bitcoin, you do not expect them to say "well bitcoin doesn't look good, we took a big gamble with something risky like this" or anything like that. It is obvious that they are very much into crypto and bitcoin hence why they did something like this, it is obvious that they would basically do something as major as this only after they researched it very well too.

These people probably know more about crypto world than I do and I have been around for many years, if you are investing as large as 250 million dollars, you hire someone to check every single line of code as well, there is no way they didn't looked under every rock before they invested such a huge amount. So when these companies get in, that makes me feel a lot better.

I'm not sure how to feel about this really. On one hand we have the optimistis that believe companies and high-firm corporations adopting cryptocurrency is a good thing as it sparks change in the future of cryptocurrency. And on the other hand we have the people who are afraid bitciin is uet again going to be a cash cow for the capitalists. Either way, I am going to hodl on my coins for better or for worse and see what happens at the end of the road.

It's not even necessarily because they believe in bitcoin themselves, it's just the arbitrage that the market demands. The balance sheet assets (because of bitcoin singularly) have ballooned significantly, which will cause the price of the stock to rise necessarily because the book value rises as the value of assets increases. The stock price appreciation is an indication that investors see "money on the table."   Doubtless some portion of these investors are likely btc bulls, but I wouldn't guess that they're investing in MSTR for their bitcoin exposure.  For one, if you just want exposure to btc, it dilutes the value of the btc exposure by investing in a business that could potentially drag the performance down (counter-point, investing in a business that generates cashflow and isn't based solely on speculation hedges risk), and secondly, gaining exposure through a medium you can't control puts you at risk that the company books profit when you wouldn't.  If you wanted btc exposure, it's very easy to get it yourself, without dilution and without a potential loss of control.  For these reasons, I view the price appreciation of the company stock as primarily a case of arbitrage (i.e., the stock price rises to match the rise in book value), not as people trying to get exposure to bitcoin.

it's clearly because of their investment in bitcoin. the nasdaq top 100 is up 15% since microstrategy first announced their bitcoin position. MSTR is up a whopping 160% in comparison! it's like night and day.

it sure looks like stock investors are using MSTR as a channel for bitcoin investment exposure.

It's unbelievable how MSTR has performed since this thread started at the beginning of August:



Admittedly, the stock market is on a tear in general, but I'd say the market either likes MSTR in general or their decision to buy up all that bitcoin.

I can't stand Coinbase myself and I couldn't tell you why Microstrategy chose them, but I suspect it has something to do with Coinbase being based in the US--but who knows.  There are a lot of details the general public isn't privy to when deals are made between companies. 

Either way, they did get their order executed.  As to whether it helped move the market upward, well....who knows.  Something caused bitcoin to shoot up to $19k.

All of a sudden, they begin to call bitcoin superior cash just because it's can easily turn one a millionaire with such kind of capital. There were the groups threatening Btc, calling it different names because they didn't get in earlier at the time but today, tye are shillings in other to accommodate other institutional investors. 

But come to think on a second thought, such kind of funds had been pump into Bitcoin in the past even when it made $19k in the past with a market cap of approximately 80 billion, it's nothing new, though but a welcome development.

As far as I remember from all the posts there were questions about how MS bought (and whether they bought BTC at all), but it always seemed logical to me that one big US company should choose another big US company for such a deal. I'm not saying they couldn't have done better, but obviously the assessment was that Coinbase would do the job the way MS envisioned it - which eventually happened.

According to what can be read in the blog, Coinbase, with its strategy, managed to save the client as much as 1% of the total transaction, which in this case amounts to as much as $4.25 million. All in all this is a very good self-promotion by Coinbase and an invitation to others to choose them in case they want to invest in BTC.

Weird choice by Microstrategy.

According to the following article, Coinbase was the platform used by Microstrategy to execute the long series of OTC and automated trades that led to their BTC investment.


Coinbase is helping corporate companies diversify with crypto




In the Case Study redacted by Coinbase there is a detailed description of the way they managed to execute the trades without moving the markets.

I am perplexed with this choice, not only I don't like Coinbase, as you know it (Coinbase the most anti-Bitcoin organisation. Make #DeleteCoinbase great again), and I wouldn't expect someone defining himself as a Bitcoin enthusiast as Micheal Saylor, using them as a service providers.
More importantly , given the poor technical performances when market moves, I might be very cautious giving them a multi-million order to be flawlessly executed. There is plenty of other OTC Desk/Exchanges with same degree of liquidity and professionality also on the whole IT operations.
 

Of course their stance on privacy is less relevant here, as MSRT has surely been trough a very cautious KYC/AML/Onboarding screening before being green lighted to operate.

With a very easy back of the envelope calculation, I can say to you that bitcoin is up 60% since their investment. So that being 33% of their market capitalisation equals to roughly a 20% increase only for this.
The whole market has gone up 7% in the meantime, so this is roughly a 27% appreciation.
The rest is idiosyncratic MSRT appreciation, for sure also due to their BTC investment.

No reason why they should not be up. It aligns with when they bought. I hope for the sake of others sucked in that it doesn't become a bubble in its own right. The largest numbers of companies doing this will be near the end of the bubble.

All that 'this is a prudent move vs the depreciating dollar' will collapse in a firestorm of screaming and recrimination. Just like regular people but with much larger figures.

And according to reports, MicroStrategy is up 50% in just three months:


https://decrypt.co/48512/microstrategys-bitcoin-is-worth-650-million-up-50-in-3-months

I don't know if the numbers is right though, but this could be one of the easiest profit a company has made without doing anything but just holding on their precious BTC. And yes, really worth the risk right now as the price surpassed $17k.

You seem to be analyzing in loops and hoops in order to downplay the facts around the microstrategy entrance into bitcoin and also the impact of such a bold move from microstrategy, whether considering short term or long term effects.

You can analyze however you like and even suggest that bitcoin is at the top of some kind of cycle when it seems way more likely that whatever UPpity bitcoin cycle we are in, if any, seems to be considerably early in such cycle with Microstrategy (and even the quantity of Saylor's personal purchases) having a direct impact on  BTC upwards price pressures and also serving as a model and influence of other people whether normies, high networth individuals, companies or governments.

Of course, you can frame Microstrategy's behavior as an aberration or even consider him as a risk loving crazy person, but in the end, there are still only 21 million coins and there are only 900 new coins made available on a daily basis.. so from where are the coins coming and seems quite likely that we are going to continue to witness ongoing upwards price pressures on BTC prices in the coming 3 to 18 months, even if we might also experience some BTC price corrections along the way too, the ultimate direction seems to be UPpity... so sure, your milage (and framing of the matter) may well vary from this scenario that I am highlighting...see it as you wish.... sorry for your loss...