Bitcoin Forum

The company with the highest amount of bitcoin as of march 31st holds about 129,218 BTC worth 5.8 billion dollars when bitcoin price was $45,602 per 1 BTC. Many bitcoin users envy the whales during the bullish run because of the huge profits they bag and don't consider how bad is their losses like when the market plunges down. According to coinmarketcap  (https://coinmarketcap.com/alexandria/article/microstrategy-suffers-170-1m-impairment-loss-on-bitcoin-in-first-quarter-of-2022)MicroStrategy had a big loss of $1billion within one month when bitcoin price dumped to $37,800. On the other flip before considering how big the amount is, it's not totally a loss on their investment knowing that they bought bitcoin at the price rate of $30,700. But, the main point is, the higher the amount of bitcoin a person holds determines how huge their profits or loss will look like when the market is bullish or bearish.

i call BS

no one makes a profit or a loss until they actually sell the coin
hoarding a coin has no profit or loss.

im hoarding alot of coin since 2012. and yet i dont even consider myself a millionaire because i have not touched my coins. even if the price indicates such.

plus microstrategy (using your example)
did not buy all its coin at $45k

if you actually look at all the coin it ever bought you will see the average is price per coin of all its haord is below the current market price meaning microstrategy is actually IN YOUR INDICATOR in profit

but as i said, because its not selling at a loss its not making a loss.. because its not selling those coins

i personally dont care about the ups and downs of the current market price. i am not stressed or upset if the current market price is down from previous month.

infact when i see posts about the price being down(which tempts me to think about current price) i see it as a potential discount day should i want to buy more. i am not concerned about the value of my current hoard being less than last month

You're saying they've suffered a big loss while remaining in profit? Are you expecting them to continuously buy and sell, dumping and rebuying $6-8bn?

Generally their balance in bitcoin remains the same, this is probably the goal of almost all round here as it has a lot more growth potential than fiat will (if big losses are a problem, you can invest elsewhere - much like microstrategy seem to have done too).

If they don't sell they don't lose anything.  Most whales do not sell in the bear market because they have enough funds to wait for another Bull run.  Some may look like cutting their losses but in the end, they plan on buying at a much lower price recovering more than the amount of BTC they sold.




Definitely, price valuation on one's holding changes according to the price in the market.  The keyword to losing in a bear market is selling.  As long as there is no act of selling, only the valuation of the Bitcoin holding suffers losses.

1BTC=1BTC meaning the whales don't lose anything as long as their keep holding their Bitcoin and not convert into US dollars, most of the big Bitcoin holders like micro strategy are in for long term gain and are holding Bitcoin as not some quick gain game as most traders take Bitcoin. I don't think whales will ever regret holding a large sum of Bitcoin since they are futuristic in their approach to the current price of Bitcoin may not mean much to them unless their want to convert it into another asset.

The accumulated volume of bitcoins were with MicroStrategy, it can't be calculated for loss. If certain volume is being sold we'll get to know about the loss out of the investment. Even now MicroStrategy keep accumulating of bitcoin unlike the market changes. So, whether it is profit/loss can't be found now. Surely it'll cause them with big fall in the portfolio, but through holding they'll easily overcome such issues.

If you're expecting everyone to be in shock at this revelation, you're going to have a surprise!

Back to the main thing, your example tells us the opposite, Micro Strategy is currently still in positive territory with over 1 billion, you can't call those losses, we are just going to go by the graph and declare here you've lost 3 billion but you're still n profit by 1billion? So the loss is a profit and the profit is also not realized because they haven't yet sold?

This is just like hitting 6 out of the 7 numbers in the jackpot, did you lose $1 million or did you make $10 000 getting the second prize?

Yes, that's always the case. That's why the more bitcoin you have, the higher risk you're taking but it's more rewarding. You'll feel more the market on its motion if you've got a lot on hold. But if you're just holding two to three decimals of bitcoin, you'll barely feel the market movement but there's still gains in the long run. As for these companies that have been holding massively, they know what they do and eventually, they'll just have to wait until the market goes back higher and  they're in profit.

The average of 30k bitcoin price is still within the last 2 years and if they decide not to the sell the size of 120k bitcoin in this market it is reasonable. They need a higher price of bitcoin at 120k+ to protect the market dump and allow the taking of profit for the company. They have not sold any against VCs like 3arrow that decieved everyone while been active selling Ethereum right in the market dip. Microstrategy is one of the institutions keep the price dump within 40% since last year.

If you just think about short term you will might get worried for scenarios you see daily but if you are into long term for sure you will not care about certain movements on daily basis because you are thinking good on it for more longer times. Also you cannot count it loss if they still posses what they buy before but if they sell then count it in because maybe its part of their strategy to do cut loss. But for sure they know how to handle the market pressure since they are old and have much huge balance to use whatever market condition and to cover up those possible losses they get.

We can't consider this as a loss as you said, they haven't sold yet. So we are not talking losses here. Also, if in case they decide to sell, they are still at big profits because they mostly bought it at $30 level price. So still a gain here. Don't know how people are speculating a loss when in fact the organization is still holding their bitcoin and so far, they have no plans of selling it?

Why worry about a company in which you have no stake or any business relationship? Maybe they really have the most Bitcoin when it comes to the public, but somehow it seems to me that there are those who buy in secret and have a lot more. What’s the next topic, how much did Mr.Mars and its companies that also invested in Bitcoin lose?

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@Accardo, if you want a little better insight into how MS invested in Bitcoin I suggest you go back to 2020 and read this thread from @fillippone (https://bitcointalk.org/index.php?topic=5268108.0), where you can see that at least 1/3 of all BTC was bought at an average price of about $20k.

Lol, you don't have to look at whales to come to this conclusion, even ordinary investors will lose big money if they sell it less than the buying price, that is pretty obvious.

That's why you really have to know that game, you do want to sell at a loss at bear market or just continue to accumulate and wait till the next bull run? Of course the best answer is the latter and this is what a smart investor is doing in a bearish trend. Instead of selling, they will continue to buy because the price is at a discount.

It is quite hard to assess the gains or losses of big whales specially those that have existed for a long time already and are very active in this industry since not every piece of bitcoin they have on their wallets can be said to have been bought at the same time or at the same price and if by some miracle yes, then the speculation of not having just one wallet would be another variable to consider. But say that we only focus on a single wallet, the above variables still exists. And to be completely logical about it, these are funds that are very difficult to liquidate or turn into fiat which makes those numbers unreliable.

You try open a newspaper. I say Michael Sailor makes me buy more BTC.

With TRX dividends.
(Swap40.524307TRX0.00008504BTC) Bong. Got it.

Say you place your bet at all time low for new coins.

They have their own strategy to deal with loss. Furthermore, the average price of bitcoin which they have bought is below the current price. It is reasonable to say that they are still in profit. Moreover, MicroStrategy is a software company with a lot of good products. This will keep them safe from a hard time until bitcoin will come back again in the next few more years. Or not

I do not consider how big or small the capital is something significant. In terms of finances, the percentage is the only number I trust. Compound interest is also a lovely number. If you manage to earn 10% monthly, you 'd be quite wealthy after years. However, in the reality, it is hard to maintain a consistent income like that.

I'm curious, for how long can Microstrategy sustain their unrealized losses? They need to make some payments, and if they have converted all their balance into Bitcoin, they need to sell Bitcoin to do that, at a loss, currently. If things go south for them, it can become a huge cautionary tale about using Bitcoin as reserve currency at a large scale.

micro strategy is an international company serving thousands of businesses around the world that pay them in fiat.

they pay their bills first. and then whatever is left over, they put into investments... NOT the other way round

meaning they get fiat from their clients. pay their bills and salaries in fiat. and any excess fiat left over at year end. they put into things like crypto to keep it safe.
(much like an off-shore trust)

they dont need to touch this, as its just excess funds they dont need that year.
then the next year, clients pay again for products and services. and bills get paid. and excesses are hoarded to the side in crypto/other investments.

its standard business.
no real world operating business gets paid in fiat, throws it all into crypto and then the next day takes it out of crypto to then pay bills.

Of course, that's obvious for the amount.

But it's not how you determine your loss and profit just because bitcoin dumps or pumps. Without selling it, you cannot say you're in profit or in loss for how many millions or billions of it.

Every company has its financial experts/advisors or whatever you call it, that has vast knowledge in investments. Its obvious that the allocated funds for company's investments is just a mere fraction of the companies total funds. If a company can invest millions of dollars in bitcoin that means they have still millions remaining in fiat or etc. to pay their liabilities.

Please don't talk about either profit or loss if you only see it on screen and don't take it. You don't have profit if you don't take profit and you don't have loss if you don't cut loss.

You can use MicroStrategy case to extrapolate it into long-term investors and short-term traders or speculators. Please don't misunderstand between speculator and investor. Their approaches and their plans are very different, long-term versus short-term. Well-planned approach versus bad-planned or no-planned approach.

BitcoinTreasuries (https://bitcointreasuries.net/)'s data shows that MicroStrategy have collected big amount for Bitcoin. Additionally, if you compares it to future supply of Bitcoin (https://en.bitcoin.it/wiki/Controlled_supply) after the end of 2032-2036 epoch era, you will see how big their portfolio is.

• Look at Block Reward 7: after the end of it, only 164062.5 left for Bitcoin Future Supply.
• Look at the Bitcoin Treasuries, what is the total Bitcoin owned by MicroStrategy ? 129218 that is a damn big amount

Tell that to the market, that every time bitcoin goes down, it makes Microstrategy's shares go down, and every time it goes up, it makes them go up. What you say applies to an individual, and not always, because if an individual has shares in a company that goes bankrupt and its shares are worth 0, would you also say that he has not lost because he has not sold?

The valuation of a company includes its assets as well as its liabilities to calculate its net worth, which means that the market does consider this case a loss even if there is no sale.

Yes you are right, but you missed the most important part. all of that happened when he sold it. if he doesn't do it during a bull or bear market. he doesn't really make a profit. only the portfolio will be seen growing. a person can be said to get a profit when he sells the coins he owns. in the case of microstategy, it doesn't really make a profit or lose, because they don't sell in a bull or bear market. they just buy and keep buying.

Ok I understand the point everyone is adding to my post. They will earn more profits if bitcoin should go bullish again and they are still in the safe side if their bitcoin is intact. I didn't view it this way and it makes sense to me now. Thanks all.

The correct explanation, if the company is still holding on to coin assets, then only the condition of the portfolio will always change based on asset adjustments related to current market conditions, so it cannot be said to be profit or loss because they have not decided to sell in a bear or bullish market. Based on the issue, they don't really care about market conditions because they believe the future Bitcoin price will be very high and they already have a lot of BTC assets in their wallets for future assets.

I do not understand why something like this is so difficult to comprehend to some people, but this kind of accounting in which a company declares they had losses during a quarter and what it really means is that they made less money than expected is simply a way to misrepresent their profits and nothing more, if someone is interested in the fiat exchange price of their bitcoin then as you say they have not lost nothing until they sell, and if someone is still in profits I cannot see how they can even say they lost money when those profits were still unrealized.

At least, for a change someone is seeing a perceived investment loss for a whale and not the regular sob story of how a whale is manipulating the market. We often think that whales are immune to losses. However, no one loses until they sell and I don't think whales panic as much as retail investors do. With a long term mindset, I don't believe Microstrategy will even be bothered with what's happening in the market ATM. Long term hodlers are diamond hands and not paper hands.

I don't know why is this such a big deal because every entity holding bitcoin has invested in it knowing the fact how volatile bitcoin is.
If a person has invested even $100 then he would encounter the same percent of loss as microstrategy if both their buy and selling prices are same.
So whether or not the amount is big or small, the profit or loss encountered as a percent is still the same depending on the buy/sell price.

when you buy a second house or a flashy car on credit. your not putting up your own money. your putting newly printed fiat whereby you agree to pay a bank later for the upfront printed money that allows you to buy something first, pay later. they ofcourse would ask to put your first house up as collateral. even if chances are that house is never touched or defaulted or lost

does this mean that people wanting to buy a second home are not home owners? just because they dont have the fiat upfront to buy the house?

..
its not like he defaulted and had to pay out his collateral in a scheme similar to 'shorting'. he still got his bitcoin and also paid back the fiat. all he done was lock in the value at a certain price so that when he steadily pays the fiat over weeks/months he is not paying a variable rate of a loan but a fixed rate loan.

smart business plan

much better then those trying to coax idiots into 'DCA' where they have no control of the price they buy in at