Topic: MicroStrategy Buys $250M in Bitcoin, Calling the Crypto ‘Superior to Cash’ - page 8. (Read 20418 times)

Frequently public companies are at a disadvantage by having to publicly disclose what they are doing, and surely we have discussed before how Saylor and MSTR had gone overboard in terms of the level of their disclosures in regards to what they were going to do, so it becomes way more difficult to sue them for failure to disclose or misleading investors in regards to their conduct.

Some of those public naysayers are coming around to bitcoin, and they don't really have a choice when the market is going opposite to their claims, and they were not able to talk people away from it.. except those people who then may become mad at themselves for listening to folks like Bill Gates and some of the otherwise reputable bitcoin naysayers.

Yes, I think that was a conservative estimate they made, but I think it will fall short in the first year. I think with the amount of institutional capital coming into the bitcoin market they are going to follow the strategy of buying as much as they can as soon as they can and that the 21+21 (billion dollars) plan might be completed in 2025 or maybe 2025 and part of 2026.


Fuck, you're even more bullish than me.

At this pace Microstrategy will have tapped that 21 billion ATM within 6 months instead of three years. You wonder as well where all these 51,780 coins are coming from without having a major impact on the price. People that are owning coins in such quantities should know you don't sell your bitcoin at this stage of the cycle (or ever).

As of this new tweet MicroStrategy has acquired $4.6 billion at -$88.627/BTC perhaps this also includes what you mentioned.
As we know that Saylor will do that, the green dot will not stop if the company still needs it.
Maybe when the price is $100K he will continue to acquire it.

This is the only institution that buys bitcoin publicly, but other institutions don't do that, so we know that the development of MicroStrategy's bitcoin purchases that we can see every day.

MicroStrategy has acquired 51,780 BTC for ~$4.6 billion at ~$88,627 per #bitcoin and has achieved BTC Yield of 20.4% QTD and 41.8% YTD. As of 11/17/2024, we hodl 331,200 $BTC acquired for ~$16.5 billion at ~$49,874 per bitcoin. $MSTR



In just over a week, the MicroStrategy company bought Bitcoin again. Michael Saylor's company that will buy bitcoins made this comment on Twitter yesterday, Michelle Saylor saying that his company needs more green dots. MicroStrategy has bought the most bitcoins today since 2020 so far. Today this company bought 51,780 bitcoins, according to today's market i.e. according to the current price of bitcoins, the total value of bitcoins they bought today is 4.6 billion dollars. Already this company has accumulated 331,200 bitcoins in their investment portfolio.

Yes that is most likely the case. It could probably be verified with some effort being put into some research, but I just take the chart as it is and am quite sure it is like you said.

The impressive aspect about MSTR is that they made it public and never made a step back. No matter where the price went, they kept doing what they announced before and they have probably overdelivered on public expectations. The last purchase high in the 70kish was a major signal to the market. They are literally not going anywhere and they have worked years on their narrative not being considered empty promises. Now they can become even more creative in raising funds as people trust them. Whether that be via convertibles or other instruments, but by announcing their 3-year plan laying out further big purchases, I think nobody doubts they are in it to win it.

They made a great call and did what I believe many here on this forum would have done if they had the same opportunity, financial capabilities and whatever else is needed to pull off what MSTR/Saylor have done. He clearly demonstrates that a lot of major companies who whould have known better missed a huge opportunity.

With that in mind, let me quote someone we all know is a tech genius:



Too bad he didn't short it. He has lost $1.5 billion in shorting Tesla and I would have loved to see him getting wrecked with shorting BTC. Too bad there was "no easy way to do it"!

Months ago, before Bitcoin Spot ETF and the bull run, Michael Saylor said in his interviews, that he considered "Bitcoin is the end game", so surely he will plan to buy more bitcoin for himself and MicroStrategy company.

They are one of earliest institutional investors in Bitcoin, and they are witnessing Bitcoin adoption growth and Bitcoin Spot ETF approvals. All these make their belief in Bitcoin bigger, and their hands are more diamonds to hold bitcoin, and lastly they will plan to buy more bitcoin.

Green dots, red dots, whatever if they buy and hold bitcoin, they will have profit. Loss is temporary and if you can hold, loss will turn to profit.
https://www.bitcoinmagazinepro.com/charts/bitcoin-profitable-days/

That's what I thought when I saw the tweet, but...seems premature to me.
42 billion in two years mean 21 buys for 2 billion in 24 months.
Maybe he wants to frontrun the buying to gain from the low quotation?
 

Michael Saylor has commented on his Twitter that his company needs more Green Dots, his comments clearly imply that his company is ready to purchase more Bitcoins and may do so very quickly. Last November 10th we saw another similar tweet from Michael Saylor, where he also said that his company needs more green dots. Two days after he made that comment, His company is MicroStrategy bought BTC27,200 bitcoins worth $2.03 billion dollars.


Michael Saylor's company needs more green dots and they buy more bitcoins.
https://x.com/saylor/status/1858133416102723888?t=HmPgClm0jcYusPpBpQzfmA&s=19
https://x.com/saylor/status/1855589307550986263?t=AzRVvSs6Ebc799R2WyMSaA&s=19

Cash is only a part of equity, which consists of total assets. There you will have to add the bitcoin they have, and if they have any paid real estate, such as headquarters, things like that.


No, they do not borrow from the bank, they borrow from the market. They make the offer in the stock market and part of those who buy it may be kind of financial institutions such as investment funds, but individual investors like you and me can also buy this convertible debt. Although I think that for the common of mortals it is better not to get complicated and buy only shares and/or funds.

Here the question is that I don't think anyone who buys that debt is not bullish on bitcoin. By buying convertible debt what you are doing is paying a premium on the bitcoin they hold (which is never redeemable) and a premium on the shares. But that debt entitles you to be converted into shares when they reach a price.

For example, the shares today are at $340, and let's say that the convertible debt is sold at $400. That debt entitles you to be converted into shares when the price of the shares reaches $500. Is there anyone who doubts that this price will soon be reached? If the shares were to take time to reach that price, the company would pay that ridiculous interest, but that is not what the investor is looking at, what he is looking at is the possibility of making 20% in a short period of time.

Michael Saylor hints at MicroStrategy's upcoming Bitcoin purchase

Michael Saylor has indicated more Bitcoin investments are imminent.
Saylor wants to make MicroStrategy the leading Bitcoin bank.

Michael Saylor, co-founder of MicroStrategy, has hinted at a potential new Bitcoin acquisition following the company’s recent purchase of 27,200 Bitcoin between October 31 and November 10.

Saylor stated in a recent post on X that MicroStrategy’s portfolio tracker needs more “green dots.”
Source Link: https://cryptobriefing.com/michael-saylor-bitcoin-purchases/
These dots refer to visual markers that indicate each instance of Bitcoin purchased by MicroStrategy, sparking speculation that the company may soon reveal additional Bitcoin investments.

MicroStrategy’s 21/21 plan and Bitcoin bank vision
MicroStrategy targets raising $42 billion over the next three years to fund its Bitcoin purchases.

The strategy, outlined in its third-quarter earnings report, is aimed at $21 billion raised through issuing new shares and another $21 billion through convertible debt or other fixed-income instruments.

---

Microstrategy companies are doing their best to invest in bitcoins, they are ready to buy more bitcoins. And they will establish bitcoin banks where only bitcoins will be held and stored for a long time. Because they are more aware of the future of Bitcoin, Michael Sylor practices every process of how to hold Bitcoin to maximize future profits. Which is why they are currently the largest holdings of Bitcoins alone, and they are constantly accumulating Bitcoins thus encouraging them to make more money in the future.
I think MicroStrategy will be considered the only successful Bitcoin holding company, and this company is known around the world.

I recall that about a year ago, Saylor gave a presentation with graduate school business students (it was Harvard, Yale, Stanford or some BIG name school) and the professor did some kind of a survey of the business students in regards if any of them would have taken Saylor's approach to bitcoin to put cash into bitcoin and also to leverage up on such company assets, and something like 80% voted against such strategy based on their learnings.. and Saylor thought that it was ridiculous that Business students were not able to recognize and appreciate the genius nature of Saylor/MSTR's approach to putting bitcoin in company treasuries.


A day or two ago I watched at 1.75x Saylor's 1 hour presentation at Cantor Fitzgerald, and I cannot remember exactly where he said that he was getting his credit (MSTR's credit) for something like 0.78% annualized rather than higher traditional rates of 6% or whatever. .but he said something like their ability to get reduced rates. 

I recall in the beginning Saylor/MSTR was paying like 8% annualized and then with each offering it got lower and lower and lower, and part of it has to do with demand, but also it has to do with other ways that the investors were profiting way greater by buying into MSTR financial products, so Saylor/MSTR did not need to offer higher rates.

Yeah, it might be unfair, but it is what the market is willing to bear, and normal people cannot get those kinds of rates, and part of the reason that Saylor/MSTR is able to get such great rates is that it has built a fairly credible track record in regards to its expertise in this area.  Sure, there are risks, and maybe the strategy keeps working until it doesn't, yet it seems while it is working, there is no reason to not jump on the MSTR/Saylor train - even though I have never bought any MSTR so far.. and I am not planning on doing it either... because I feel good enough having my own bitcoin... rather than relying on 3rd or 4th party managerial and custodial risks.

Sad to say, I did take a course in corporate finance when I was in college and for the life of me I can't recall what the significance of the debt:equity metric is.  I did take a look at MSTR's (abbreviated) balance sheet on Yahoo Finance, and it looks like they've got $46.34M in cash and $4.27B in debt.  Normally I'd say that isn't great, but obviously they put that borrowed money to what turned out to be a good use, i.e., their bitcoin purchases. 

I was going to post a screenshot as a reference, but talkimg isn't responding at the moment.



I probably missed a lot in this thread, but I have to ask how they were able to borrow money at rates not only lower than inflation but lower than the Fed funds rate.  They were actually able to do that to finance their bitcoin purchases?  If that's true, MSTR must have some very friendly bankers.

MicroStrategy's $26 Billion Bitcoin Cash Is Bigger Than IBM, Nike Cash Holdings
https://www.bloomberg.com/news/articles/2024-11-16/microstrategy-s-26-billion-bitcoin-cache-is-larger-than-ibm-nike-cash-holdings



MicroStrategy Company has been continuously buying Bitcoins since 2020. The total number of Bitcoins hold by this company is already BTC279,420. The price of Bitcoin has risen to a very high level in this year which has also increased the value of this MicroStrategy company's Bitcoin holdings. MicroStrategy has already amassed approximately $26 billion worth of bitcoin holdings. They are already ahead of IBM and Nike as their Bitcoin holdings increase.

‘Planning The Bitcoin $100,000 Party’: MicroStrategy’s Michael Saylor

Vigorous Bitcoin advocate Michael Saylor, MicroStrategy’s co-founder and currently its executive chairman, seems to be expecting the world’s largest cryptocurrency to break above the $100,000 level soon.

After Bitcoin surpassed the $92,300 zone, Saylor published a tweet, saying that he was “planning the Bitcoin 100k party.”
source: https://u.today/planning-the-bitcoin-100000-party-microstrategys-michael-saylor

Michael Saylor says,


Michael Saylor believes that Bitcoin will touch $100k very soon due to the high rate of Bitcoin price currently. In view of this, he announced on his Twitter profile that he is ready to party when the price of Bitcoin reaches $100k dollars.
Right now we are seeing a slight correction in the Bitcoin market, but we are optimistic and believe that Bitcoin will start to grow again very soon and touch $100k dollars.

Yes, what I want to point out here is that none of the financial instruments issued by MSTR can redeem bitcoin. So it is completely different from a bitcoin ETF in that in the ETF they buy if you buy shares of the ETF and sell if you sell, so as you say they are nothing more than an intermediary that does the custody (and the buying and selling of the actual bitcoin).

What Saylor does is kind of printing money to buy bitcoin through debt instruments, and so he says that the first state to do the same, in this case printing fiat money directly to buy bitcoin, will win the global race.

For example, convertible notes can be redeemed for shares (never for bitcoin) and are bought at a premium over shares. The shares also have a premium over the net asset value, which is basically the bitcoin owned by the company.

So, when they issue $1B of convertible notes, they do so on a Net Asset Value of say $0.5B, and what do they do with that $1B? They buy bitcoin. They are using the financial instrument to get fiat money to buy bitcoin.

Also convertible notes are not problematic at all because if people start exchanging them for shares you can always create more, similar to how a FED can print more fiat.

If anyone is concerned about this type of indebtedness I have to say that I, as a good shareholder, have looked at the fundamentals of the company and it has a debt to equity ratio of 1.13 which falls within a very reasonable range of indebtedness, and if we also take into account that the company is borrowing at laughable prices, clearly lower than the inflation rate, we will agree with Saylor that the debt they use to acquire bitcoin is issued and controlled in a smart way.

I am pretty sure that the chart that you showed, tiCeR, is ONLY referencing how many BTC various companies have in their own corporate treasuries.

We could have other charts showing stock price values or how many coins companies are custodying  on behalf of clients, which truly would not be their own coins, and there are some charts that show those kinds of custodying situations.

Actually arguments could be made that MSTR is custodying coins on behalf of others, yet that is not MSTR's current business, since they are not a bank nor a custodian of BTC.   

Guys likely realize that MSTR has been fairly creative in the various ways that they finance their purchasing of BTC, and some of the coins were bought outright with company cashflow, and other coins were bought by the issuance of debt, and other coins were bought through the issuance of equity, and surely I am not going to attempt to proclaim to understand how each of the different tranches of coins might be considered as owned outright  versus some of the coins might be encumbered, yet Saylor and MSTR seem to be pretty damned good negotiators, so frequently, they issue debt or they use equity of the company in ways in which they don't necessarily encumber the coins, like in a collateral kind of a situation, and/or there tend to not be restrictions on the coins or Saylor or MSTR's ability to issue more debt, and surely whatever he does ends up having magnifying effects when the BTC price is going up, and surely they are likely still protected in regards to a certain amount of BTC price downfall, and I could not imagine them failing/refusing to project out a variety of scenarios and to have plans for a variety of contingencies.

Yes I agree that the charts sometimes are somewhat vague, but for this case it made a lot of sense to share it. I pointed out Coinbase because I remember how in the beginning I thought when they get all their licensing sorted out and are US based and then go public, it was all set for them to grow into a major player in the world. That is what I thought, but they have had their issues here and there and Coinbase was never really particularly liked among the community.


I tend to think that the chart is supposed to show their own holdings, the company's property. But I would be wrong and who knows how well this was investigated by whomever has prepared the chart.

But I think it demonstrates very well the dimensions, which is mind-blowing. It's actually ridiculous if you think about how long BTC is around and how clearly MSTR has been emphasizing that BTC is the thing of the future and yet no other player had the guts to at least be a bit more aggressive? This is what strikes me as odd. MSTR is going to be immensely powerful in the business because they just began to snowball. This is the beginning, not the midgame or something. They can leverage against their holdings like crazy, and they will.

I snipped that chart out, as I don't like to quote huge things like that, but I was surprised that MSTR is so far ahead of those other companies in terms of BTC ownership.  As far as Coinbase's holdings, am I correct in assuming that includes its customers' bitcoin that they simply have custody of?  Either way, that data is astonishing to me--and if anyone ever wanted proof as to Michael Saylor's belief in bitcoin, that graph would suffice.

Those last two companies, CleanSpark and Hive Digital I'm not familiar with.  In fact, there are a couple more that I haven't heard of, but presumably they're big players in the bitcoin space.  However, I'm not sure if a comparison with any big mining operation like Riot is appropriate since they don't necessarily hold bitcoin for the long term like MSTR does.

Anyway, thanks for dropping that info.

We will have to see how this works out for them as the company does not seem to be doing very well.

All time chart:



Last week chart:



If this and other companies do well, a brutal FOMO will be unleashed. MSTR's business intelligence business has totally taken a back seat because it earns them $75M a year and as of today issuing debt at less than 1% and buying bitcoin is something they can get in 5 days.