MicroStrategy Buys $250M in Bitcoin, Calling the Crypto ‘Superior to Cash’

[JayJuanGee]

The financial director of MicroStrategy, Fong Le, also supports the position of CEO Michael Saylor (well, it would be strange if he had a different opinion) and says that MicroStrategy plans to continue to only buy bitcoin, despite its price drop and claims from regulators, but not to sell it.

A very optimistic attitude certainly causes respect and hope for the future, by the way, there is a mention in the article that even with the existing price, MicroStrategy has already earned more than $750 million on its investments in bitcoins.
https://www.wsj.com/articles/microstrategy-to-continue-buying-bitcoin-despite-market-tumble-cfo-says-11643106608

I became very interested in how the investment analysis was carried out before actually entering the crypto world.  Especially when the price increased a few weeks ago, and now it has fallen and almost touched its low point yesterday, but he still decided to hold their assets.  Even with the drop in prices, Saylor didn't really care.  Considering the heating conditions in the regions of Russia and Ukraine, it was enough for the market to hit prices down, even though they were fit to sell and take profits as they did.

If you are both holding yourself out as a "forever HODLer" and you actually believe in that idea, you are not going to get motivated into action (selling or considering shaving any off blah blah blah) absent some kinds of really compelling circumstances.  I am going to recognize that likely Saylor has complete authority to manage MSTR's bitcoin however he would like, even if he may have some individuals and companies acting on his behalf in terms of both custody and within other acquisition parameters.... so having had said that, he has the actual ability to sell some any time that he want.. but he is not going to do it.. and even events that might seem extreme to some of us normies he is not hardly even going to budge in terms of taking any selling action... Even if psychologically, Saylor might be alerted or even personally bothered by some of the various seeming downward extremes that take place in bitcoin price dynamics,  I doubt that he is going to see those as outrageous in any kind of a way - even if they might be unexpected and various parts of the world/even within BTC circles might be overwhelmingly into panic mode... In other words, there would need to be some fundamental breaking in bitcoin that would cause him to go down any road besides buying some more on the dips.

Yeah.. I am not Saylor... but he's not shaken by any of these somewhat normal happenings, including that we should expect that there may well be ongoing attacks on bitcoin that might even be sustainable...

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[fillippone]

So four different reasons why I tend to suspect that statement.

A little update on the above.
The two address now cumulatively hold 128,870 BTC, corresponding to an increase of roughly 6,090 BTC since last announcement.
Si, either or Microstrategy is going to announce such increase, or this address belongs to a different entity.

I am very curious, and still think the latter is the true.

[fillippone]

A big surprise!

On February 1, 2022, MicroStrategy Incorporated (the “Company”) announced that, during the period between December 30, 2021 and January 31, 2022, the Company purchased approximately 660 bitcoins for approximately $25.0 million in cash, at an average price of approximately $37,865 per bitcoin, inclusive of fees and expenses. As of January 31, 2022, the Company held approximately 125,051 bitcoins that were acquired at an aggregate purchase price of $3.78 billion and an average purchase price of approximately $30,200 per bitcoin, inclusive of fees and expenses.

As you can guess from the statement, being only 25 millions, it’s a purchase funded with Microstrategy’s own cash, while the previous buys were funded trough the ATM facility.
This is the reason why I am saying it’s a big surprise…

[JayJuanGee]

A big surprise!

On February 1, 2022, MicroStrategy Incorporated (the “Company”) announced that, during the period between December 30, 2021 and January 31, 2022, the Company purchased approximately 660 bitcoins for approximately $25.0 million in cash, at an average price of approximately $37,865 per bitcoin, inclusive of fees and expenses. As of January 31, 2022, the Company held approximately 125,051 bitcoins that were acquired at an aggregate purchase price of $3.78 billion and an average purchase price of approximately $30,200 per bitcoin, inclusive of fees and expenses.

As you can guess from the statement, being only 25 millions, it’s a purchase funded with Microstrategy’s own cash, while the previous buys were funded trough the ATM facility.
This is the reason why I am saying it’s a big surprise…

Largely I agree with you fillippone.  Several times, I have seen folks commenting on Saylor and his way of directing MSTR, and frequently there are guys trying to get in their little digs about Saylor being too risky or MSTR otherwise being a failing company, but even if we might consider that MSTR is able to generate enough extra cashflow a couple or a few times a year of $25 million, I find that difficult to characterize them as a failure - especially in these times when having some extra cashflow might be less than reliable... though of course, even Saylor has admitted that his whole company has generated some extra attention and therefore extra business through its having become more well-known through its recent publicly aggressive bitcoin stance.

Those numbers look really good too, in terms of its overall stash costs and size and the amount that it is still in the green.. Some people have been speculating that MSTR is not in the green enough.. but I would still consider that those folks are too much trying to let the perfect be the enemy of the good - because sure we could likely assert that MSTR could have timed its bitcoin buys more strategically or even engaged in some trading behaviors and blah blah blah would have been better, and nearly always there are ways to engage in Monday morning quarter-backing - yet being in the actual game and actually carrying out the buys, the maintenance strategies while being public about it remains quite an amazing feat - even if there are naysayers suggesting a variety of ways that "it could have been better" blah blah blah.

Not to be mixing subjects too much, but I saw some similar bullshit bout stock to flow today too.. already writing it off and saying it has failed and suggesting various alternative (and likely fly-by-the-seat of your pants) theories,.., without really committing in any kind of solid way.. and for sure the stock to flow has a commitment.. which is different than just throwing out a variety of ideas to see what might stick.. so similar with MSTR.. there is a certain validity that comes with actually putting theory to practice rather than merely talking some kind of vague BIG game and saying that you were correct afterwards, when no one could figure out what the fuck you had been saying ahead of time..... end of rant.      for the moment

[fillippone]

Microstrategy is holding their Quarterly Earning Conference.

Apparently, I am good at learning GAAP accounting from scratch and at basi math:




I predicted the figure here , and seems I was spot on.

Here you have the full presentation.

[Wiwo]

My bad I was not aware of this update so I created a thread about this development a while ago but have lucked it.
here: https://bitcointalk.org/index.php?topic=5383996.msg59136161#msg59136161

A big surprise!

On February 1, 2022, MicroStrategy Incorporated (the “Company”) announced that, during the period between December 30, 2021 and January 31, 2022, the Company purchased approximately 660 bitcoins for approximately $25.0 million in cash, at an average price of approximately $37,865 per bitcoin, inclusive of fees and expenses. As of January 31, 2022, the Company held approximately 125,051 bitcoins that were acquired at an aggregate purchase price of $3.78 billion and an average purchase price of approximately $30,200 per bitcoin, inclusive of fees and expenses.

As you can guess from the statement, being only 25 millions, it’s a purchase funded with Microstrategy’s own cash, while the previous buys were funded trough the ATM facility.
This is the reason why I am saying it’s a big surprise…

Great to see that this time the 660 Bitcoin where bought with cash through the SEC approval this speak volume into how dip Bitcoin have attained in global adoption.

[noormcs5]

Great to see that this time the 660 Bitcoin where bought with cash through the SEC approval this speak volume into how dip Bitcoin have attained in global adoption.

Crypto is superior to cash and time will prove it. The early you know about this , the better it is for you.

Micheal Saylor was the highlight of 2021 and even they contiune to buy bitcoin in 2022. Microstrategy’s has gain a lot of fame after they have started buying and accumalting bitcoins.
I think of a time when other companies will think in such terms and bitcoin will be too much expensive at that time. This is a golder oppurtuinty for everyone to accumalte bitcoins.

[stepwilli]

Crypto is superior to cash and time will prove it. The early you know about this , the better it is for you.

Micheal Saylor was the highlight of 2021 and even they contiune to buy bitcoin in 2022. Microstrategy’s has gain a lot of fame after they have started buying and accumalting bitcoins.
I think of a time when other companies will think in such terms and bitcoin will be too much expensive at that time. This is a golder oppurtuinty for everyone to accumalte bitcoins.

We are already on the time where cryptos are now very well known and its usage is known to not only work as a currency but also an asset. This is enough to consider that crypto is much more superior to cash. We do not need to wait for the time where cryptos can replace cash to be able to call it superior because there is a small chance that it will happen as there are governments that are still against with cryptos.

Microstrategy is proud to be on top of the companies that holds a huge amount of bitcoins. It gives them a good feeling when someone is motivated to do the same as what they are doing so they will try to show off more by buying more bitcoins.

[Pik2]

I don't think anyone really uses bitcoin as cash.

Most just see it more like a stock as an investment not for every day use and until bitcoin can be stable and used in everyday life it will not be superior to cash.

[virasog]

I don't think anyone really uses bitcoin as cash.

Most just see it more like a stock as an investment not for every day use and until bitcoin can be stable and used in everyday life it will not be superior to cash.

That is not the case as bitcoin is used both as a means of investment plus as a currency. Even you can read some of the use cases discussed on this forum where startups are integrating bitcoin into their business model. Pay for coffee with Bitcoin   and  A supermarket in Mexico now allows Bitcoin payments for all their items are few examples where people actually pay in bitcoin to get coffee or services.

[fillippone]

This is a whole new thing:



This is something Micheal Saylor’s referenced to in his interviews: getting loans from your company and use the proceeds to buy more bitcoins.

Leverage.
They secured an interest only credit facility secured using bitcoins. They will use that line to buy more bitcoins: they will pocket a little more than 4,100 btc.
Not bad, they are back in the big ground.

The news is all over Twitter, more or less every time is saying the sanscrito details. Interestingly there is one:

 

Those conferences were quite useful then!

[jeha2015]

I don't think anyone really uses bitcoin as cash.

Most just see it more like a stock as an investment not for every day use and until bitcoin can be stable and used in everyday life it will not be superior to cash.

That is not the case as bitcoin is used both as a means of investment plus as a currency. Even you can read some of the use cases discussed on this forum where startups are integrating bitcoin into their business model. Pay for coffee with Bitcoin   and  A supermarket in Mexico now allows Bitcoin payments for all their items are few examples where people actually pay in bitcoin to get coffee or services.

adoption has coming in several countries, alot merchant starting accept bitcoin in their transaction. we have multiple benefit using bitcoin in our life, first it could reduce bank transaction fee, bordless , and also its value as investment assets. day by day alot good news spreaded about adoption, even in US some county propose about its legal tender.

[fillippone]

Microstrategy started using their fresh funds to buy bitcoin:



They bought 190 billions with 205 millions loan. Wondering if they saved some change money, or the fees are so big.
Hope it is the first one.

[Daltonik]

Microstrategy started using their fresh funds to buy bitcoin:



They bought 190 billions with 205 millions loan. Wondering if they saved some change money, or the fees are so big.
Hope it is the first one.

Well, they write that they paid an average of $45,714 for btc https://www.coindesk.com/business/2022/04/05/microstrategy-buys-1905m-worth-of-bitcoin/ , I think they have somewhere to put the remaining funds from the loan. for example to secure previous loans or something.

[Daltonik]

CNBC's Mackenzie Sigalos talks to MicroStrategy CEO Michael Saylor, where he explains why you shouldn't sell your bitcoins if you decide to invest in them. and also how Microstrategy uses bitcoins as an "ideal" collateral for obtaining a loan to buy more bitcoins, using the example of a loan taken for these purposes from Silvergate Bank, this, in his opinion, leads to the normalization of the financial industry with the help of bitcoins, and does not destroy traditional finance. The interview with Michael Saylor begins on the 4.05 timeframe https://www.youtube.com/watch?v=8GXy0o0tT28

[fillippone]

CNBC's Mackenzie Sigalos talks to MicroStrategy CEO Michael Saylor, where he explains why you shouldn't sell your bitcoins if you decide to invest in them. and also how Microstrategy uses bitcoins as an "ideal" collateral for obtaining a loan to buy more bitcoins, using the example of a loan taken for these purposes from Silvergate Bank, this, in his opinion, leads to the normalization of the financial industry with the help of bitcoins, and does not destroy traditional finance. The interview with Michael Saylor begins on the 4.05 timeframe https://www.youtube.com/watch?v=8GXy0o0tT28

A little bit OT on the thread, but while Saylor teaches us never to spend our bitcoins, Jack Mallers is literally making us easier to spend our precious seats. Who’s the real bitcoiner?
What would have happened if Lazslo never bought those pizzas and howled instead?

[Xal0lex]

A little bit OT on the thread, but while Saylor teaches us never to spend our bitcoins, Jack Mallers is literally making us easier to spend our precious seats. Who’s the real bitcoiner?

If Michael Saylor says he will never spend bitcoins, or he won't even spend them in 100 years (or something like that), how is he going to profit from his huge investment? I somewhat don't understand the point of a company investing in an asset that they won't be able to spend or lock in a profit in their lifetime. You can buy all the time and all the time, but how is that going to help the company if they are not going to make a profit on their investment? Will they pass this function on to their descendants or does Sailor just not want to touch the subject of the fact that he will have to sell some bitcoins at some point and it could bring down the market? After all, everyone is used to reading that Sailor is only buy bitcoins.

[JayJuanGee]

A little bit OT on the thread, but while Saylor teaches us never to spend our bitcoins, Jack Mallers is literally making us easier to spend our precious seats. Who’s the real bitcoiner?

If Michael Saylor says he will never spend bitcoins, or he won't even spend them in 100 years (or something like that), how is he going to profit from his huge investment? I somewhat don't understand the point of a company investing in an asset that they won't be able to spend or lock in a profit in their lifetime. You can buy all the time and all the time, but how is that going to help the company if they are not going to make a profit on their investment? Will they pass this function on to their descendants or does Sailor just not want to touch the subject of the fact that he will have to sell some bitcoins at some point and it could bring down the market? After all, everyone is used to reading that Sailor is only buy bitcoins.

I doubt that it is that difficult to understand why a pristine asset would be valuable to HOLD.  I have nothing against spending bitcoin, but there is a very valid point towards understanding Gresham's law which would suggest that it is much better to spend from any of our assets or currencies that hold their value less before spending from assets or currencies that hold their value the most - and being speculated as the best of pristine assets means that bitcoin would be speculated to hold its value the best, so it would be the asset/currency that any of us should be spending last, if we have a choice and we are holding more than one kind of asset/currency.

[fillippone]

Interesting developments are unfolding around MicroStrategy. Recently, more and more often I see articles on the topic that the company began to secretly sell bitcoin. The company's shares have recently fallen in price by 50% and Sailor began to fix part of the accumulated bitcoin. I see that according to some data, we are talking about the sale of 1,500 BTC, according to other data, we are talking about a secret sale of 8,000 BTC



It is clear that Saylor will refute any accusations of selling bitcoin:

I saw that report, but I didn't bother to report it here, as it is clearly pure speculation regarding the addresses, and complete nonsense when it comes to "secret selling".

OF course, there's no way to understand which addresses report to MSRT. During the last months more than one attempt to spot the Microstrategy address has been made, but always failed.

In addition to that, as MSRT is a listed company, every buying or selling o bitcoins have a potential impact on the share price. So any of these trades must be timely reported to SEC.

So, no. Microstrategy hasn't been selling.

[JayJuanGee]

Interesting developments are unfolding around MicroStrategy. Recently, more and more often I see articles on the topic that the company began to secretly sell bitcoin. The company's shares have recently fallen in price by 50% and Sailor began to fix part of the accumulated bitcoin. I see that according to some data, we are talking about the sale of 1,500 BTC, according to other data, we are talking about a secret sale of 8,000 BTC



It is clear that Saylor will refute any accusations of selling bitcoin:

I do recognize that you Ratimov have maintained some level of guarded skepticism regarding what rich people/companies do and what they say, and I suppose that there is nothing wrong with continuing to maintain some alertness in regards to whether contradictions of the statements can be seen through actual actions.

For sure, the language of a lot of the MSTR debt instruments retain quite a bit of flexibility in order that Saylor can do what he wants in regards to the MSTR bitcoin holdings, and surely he would end up getting himself into quite a bit of a pickle if his actions (such as selling large quantities of BTC) were to greatly contradict his many statements in which he proclaimed that he is not selling (and/or never selling and strong statements like that)...

So for sure, in that regard, disclosures in any SEC filings (that he does have to make) may well end up coming quite a bit after he had already sold.. but surely, I would continue to imagine that Saylor does not even come close to acting as internally contradictory as someone like Elon Musk in which Elon is saying all kinds of contradictory things on an ongoing basis and likely figures that a kind of craziness works to his advantage in terms of being able to continue to do what he likes, but Saylor seems to be way more of a straight-shooter in the sense that he does not make those kinds of all over the place statements, and his actions seem to ongoingly consistent with his statements in terms of ongoing bullishness, so I really doubt that Saylor is going to put himself (or his company) into some kind of a questionable position in regards to whether "not sell" really did mean "not sell" or it just meant "don't sell very much".. .  hahahahahaha

Of course, there is going to be some level of faith regarding whether a guy like Saylor is good for his word in regards to how he talks about bitcoin, and surely there are so many folks out their just drooling to see him slip up in some kind of way to show that he is really an opportunist rather than the real deal bitcoin bull that he holds himself out to be, and on a personal level I doubt that Saylor is going to be fucking around like that, and I believe that it works way more to his personal (and company) advantage to just remain steadfast in the mega bull category and let the chips fall where they may.