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

[JayJuanGee]

I have to admit MicroStrategy is a great company that consistently buys Bitcoin when the price drops and has positive feedback from people who can show their absolute faith in Bitcoin. To date, they have purchased billions of dollars with an average value of $44k.
I think they are an investment company with a long-term strategic vision. I believe they will be right as they are the largest whales that I know of. I hope this price drop is finally testing support so that Bitcoin can rally sharply to achieve a higher ATH.

Not sure about your reverence to an average value of $44k, noorammak.

From my understanding, the latest news from Microstrategies was an average purchase price for their BTC of between $24k and $25k.. So I am NOT sure from where you are getting the $44k.

I did a quickie look at Saylor's twitter account, and I saw a tweet from yesterday that said:

>>>>>
"I sold bitcoin
10.8%

I hodled bitcoin
52.6%

I bought bitcoin
36.6%"
<<<<<<

https://twitter.com/michael_saylor/status/1396094758930599939

So, I am not sure exactly what the contents of that tweet means.. even though it does add up to 100%.. I thought that Saylor said that he was not going to sell any BTC for a long time (such as 100 years, which likely was a bit of an  exaggeration), but surely the average buy-in price becomes more complicated if also shaving off some profits.. not sure if Microstrategies might have done that.. and if so how they would account for it, if they had done that.

The estimated time for them to sell their BTC is when their portfolio is losing. 

That statement comes off as almost retarded.

If a company or individual buys into an asset based on a philosophy that they are NOT investing more than they can afford to lose, then by definition they are willing to ride that asset through the ups and downs and they dlo not get worked up about whether they might be in profits one minute and at a loss the next minute.

The investment is serving as a hedge to the dollar so the investment would be serving that purpose whether it is in profits or at a loss.

Most traditionally-minded sophisticated investors are going to hedge with a minority of their total portfolio, so that might be 1% or maybe even going up to 20% in the more extreme cases, so Saylor and Microstrategy's use of the term hedge to describe what they have been doing may well be a bit of a stretch of the concept, because they seem to be using very high portions of their cashflow and adding debt into that too which causes it to go quite a bit beyond traditional hedging concepts in terms of percentages of their cashflow dedicated to bitcoin (and yeah they have also used the term reserve asset to suggest that they are not really hedging in bitcoin, but instead going all in to treat bitcoin as a reserve asset.. also seems quite radical to take that approach to any kind of balancing so then whatever they have left in dollars might end up serving as a hedge of their bitcoin assets.. hahahahaha)...

Another way of accounting for what Microstrategies is doing would be to calculate its total value as a business and then to measure what proportion of their total company value is in bitcoin, so in that regard, the amount in bitcoin would end up being a smaller percentage as compared to merely looking at the cashflow and debt of microstrategies. 

Anyhow, I am largely attempting to pick on your (oHnK) description of selling at a loss as some kind of preferred strategy that any company should be following.  I do understand that some companies will sell and rebuy assets at a loss and sometimes even sell at a loss to offset gains.. but I doubt it is a preferred strategy except to strategically employ but does not seems to be something that would be a sustainable practice or even a smart way of investing for either companies or individuals.

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[The Sceptical Chymist]

The investment is serving as a hedge to the dollar so the investment would be serving that purpose whether it is in profits or at a loss.

Say what?  Bitcoin isn't much of a hedge against the dollar if it drops below the dollar value you bought it at--does that make sense or am I missing something? 

Regardless, I am hoping that companies like MSTR don't decide or get forced to sell their bitcoin holdings because of this drop.  That would likely be catastrophic to the entire crypto market.  I think there must have been at least some selling by institutional investors and/or deep-pocket speculators in the last week and a half, because there hasn't been any seriously bad news about bitcoin other than Elon Musk's tweeting (though he's very influential and people might have taken his words to heart). 

It should be interesting to see what MSTR's stock price does this week, if it reacts to bitcoin's losses--which I'm almost certain it will. 

[JayJuanGee]

The investment is serving as a hedge to the dollar so the investment would be serving that purpose whether it is in profits or at a loss.

Say what?  Bitcoin isn't much of a hedge against the dollar if it drops below the dollar value you bought it at--does that make sense or am I missing something? 

My understanding of hedging is a long term thing, so it is based on differing concepts.  So for example, historically gold has been considered as a hedge against the dollar in terms of sound money principles, but surely gold has not been performing very well as a hedge because partly it has been manipulated a lot in terms of almost converting it into a dollar product - but if shit hit the fan with Armageddon, and the only means of currency was various hard assets, then gold could well ending as a very decent medium of exchange in those kinds of circumstances

NOT everyone is going to agree that bitcoin is a better hedge than gold, but in late 2013, one of my initial reasons to get into bitcoin was because I considered it as a better than gold hedge.. and likely that investment thesis regarding bitcoin is stronger than it was in 2013.

Of course, we might not always know why one asset goes up against another, but sometimes if we zoom out longer term, we can  have a lot of better ideas regarding what is going on.. but even if you zoom out, you might not get it right or even understand what the fuck is going on (not referring to you specifically, pharmacist), so for example in March 2020, bitcoin fell in value more than the dollar and more than equities and even more than gold and gold was performing better than bitcoin for a few months, until it did not.. so a lot of people were spouting out about bitcoin lacking in hedging properties, and they can believe their nonsense hopes all that they like, seems to me that bitcoin already has been eating golds lunch and will continue to eat gold's lunch as well as absorbing value from a lot of other storage of value assets, because bitcoin is a superior product, whether you recognize it or not.. and whether it takes 10-50 years for the whole matter to play out.. including that we can also see a lot of hedging properties in bitcoin in shorter time frames, but sometimes it can be difficult to either understand or to appreciate what is going on when caught in the middle of it..

Regardless, I am hoping that companies like MSTR don't decide or get forced to sell their bitcoin holdings because of this drop. 

Seems that MSTR specifically is in a pretty decent position and they will neither sell and it seems quite likely that the market is not going to force them in that direction.  There might be other companies who play their cards differently and might get caught on the wrong side of trades... that then force them to do even dumber things...

Of course, public companies are going to have to be a bit more transparent than other kinds of companies, so even if the information might appear to go all over the place regarding what they did, what they are doing or what they plan to do, there is going to be some information better than other information too, and frequently, short term exaggerations of market movements can be opportunities for regular peeps and smaller players to take advantage of the information disparities and some of the pure nonsense that is being spouted out as if it were true.

That would likely be catastrophic to the entire crypto market.  I think there must have been at least some selling by institutional investors and/or deep-pocket speculators in the last week and a half, because there hasn't been any seriously bad news about bitcoin other than Elon Musk's tweeting (though he's very influential and people might have taken his words to heart). 

Even though the information is different than previously, and sometimes the exaggerations can attempt to make the situation seem worse than ever or "unprecedented" many of us are still going to recognize either buying opportunities or at least HODLing opportunities rather than getting frustrated, selling, or failing/refusing to buy because expecting the price to drop more and such further drop might not happen.  Frequently failing to prepare for UP can be almost as bad as overly preparing for DOWN.

It should be interesting to see what MSTR's stock price does this week, if it reacts to bitcoin's losses--which I'm almost certain it will. 

I still believe that "this week? is too short of a time horizon, and seems to me that MSTR will likely disclose at some point that it bought $10 million or $20 million or $30 million or maybe even more bitcoin.. .. but even if they did not buy this week or during this particular dippening (or announce that they bought)... so what.

[noorammak]

I have to admit MicroStrategy is a great company that consistently buys Bitcoin when the price drops and has positive feedback from people who can show their absolute faith in Bitcoin. To date, they have purchased billions of dollars with an average value of $44k.
I think they are an investment company with a long-term strategic vision. I believe they will be right as they are the largest whales that I know of. I hope this price drop is finally testing support so that Bitcoin can rally sharply to achieve a higher ATH.

Not sure about your reverence to an average value of $44k, noorammak.

From my understanding, the latest news from Microstrategies was an average purchase price for their BTC of between $24k and $25k.. So I am NOT sure from where you are getting the $44k.

I did a quickie look at Saylor's twitter account, and I saw a tweet from yesterday that said:

>>>>>
"I sold bitcoin
10.8%

I hodled bitcoin
52.6%

I bought bitcoin
36.6%"
<<<<<<

https://twitter.com/michael_saylor/status/1396094758930599939

So, I am not sure exactly what the contents of that tweet means.. even though it does add up to 100%.. I thought that Saylor said that he was not going to sell any BTC for a long time (such as 100 years, which likely was a bit of an  exaggeration), but surely the average buy-in price becomes more complicated if also shaving off some profits.. not sure if Microstrategies might have done that.. and if so how they would account for it, if they had done that.

Sorry for the miscommunication, I didn't look closely and made a quick judgment.
MSTR is the company that buys a lot of Bitcoin so far that I know and they are making good profits. We are still in the Bull market so the upside will continue. I assume they will sell their investment at $100k or higher.

https://twitter.com/michael_saylor/status/1394625128257007618

[JayJuanGee]

[edited out]

Sorry for the miscommunication, I didn't look closely and made a quick judgment.
MSTR is the company that buys a lot of Bitcoin so far that I know and they are making good profits. We are still in the Bull market so the upside will continue. I assume they will sell their investment at $100k or higher.

https://twitter.com/michael_saylor/status/1394625128257007618

Of course, Microstrategies has created financial instruments and even various public disclosures that provide them with a pretty much blank slate in terms of being able to do what they want (at their discretion) to be able to sell their bitcoin, but at the same time, MSTR is a bit of a unique beast in terms of mostly being controlled by Saylor and Saylor pretty clearly and unambiguously that he does not consider bitcoin as a kind of thing that you fuck around with in terms of trading - so he has clearly and unambiguously stated that he is "in" bitcoin for the longrun, and he has backed that up with rationale and various sound money talking points - so he really seems to be quite an exception in terms of not ONLY getting what bitcoin is about, being well able to articulate what bitcoin is about and largely putting his money where his mouth is.

I understand that many of us have become jaded about trusting what any politicians or corporate leaders or other "thought leaders" say in terms of what they are going to do and in what circumstances that they are going to do it, so I will agree with any assertion that we need to take statements with a certain grain of salt and not get too reliant upon what someone like Saylor says he is going to do.  However, at the same time, I would not be presuming that he is going to sell at $100k or $200k or even any higher price either (even that is something that you would do or something you believe that he should do.. blah blah blah), because you are merely attributing the opposite to him than what he said that he was going to do with absolutely no evidence to back it up beyond speculation that he is going to do the opposite merely because people will sometimes do the opposite or whatever other jaded perspective might have been embedded into your thinking through the years.. hahahahahaha.

Personally, I consider it to be way more reasonable to consider and presume that Saylor is going to do what he said that he is going to do, and if Saylor ends up backing out of what he said or NOT doing what he said, then cross that bridge at that time.. It is not going to be the end of the world, if Saylor ends up being a liar or a person that speaks out of both sides of his mouth, but we surely do not have a scant of evidence to suggest that he is that kind of person.. as far as I have seen so far to date. 

Furthermore, none of us should be putting anyone (whether Saylor or any other long term bitcoiner) on a pedestal.. even though at the same time, we surely can (and probably should) appreciate various contributions that some of the longer term bitcoiners have made to the space, but if they start to talk gobbledy gook shitcoiner nonsense or seem to be acting like personal opportunists that you cannot rely upon what they say to be honest, then of course, they should be called out on those kinds of things...and sometimes we might not even agree about what is good behavior or bad behavior.. and I suppose that some issues might escalate regarding disagreements.. and sure, we can respect what Saylor has done so far in his ONLY about 10 months of publicly speaking about bitcoin and we can even agree with him on a variety of the positions that he has taken in regards to bitcoin, but we should not be afraid to lecture him or to call him out if he does end up getting on the wrong side of things from our own perspective(s).. and he has been called out on a few things so far by some bitcoiners (such as his seemingly friendly posture towards the need for regulatory clarity in the BTC space)... which I see absolutely no problem with people expressing differing opinions on that particular topic.. but from my perspective, still those kinds of differing opinions should not rise to the level to consider that Saylor is a sell out regarding core bitcoin values or that he is going to sell his bitcoin merely because his portfolio went up 5x or 10x in terms of its fiat value, merely because some of his views seem to be contrary to the views of other respected bitcoiners in the space.

[oHnK]

 MSTR is a bit of a unique beast in terms of mostly being controlled by Saylor and Saylor pretty clearly and unambiguously that he does not consider bitcoin as a kind of thing that you fuck around with in terms of trading - so he has clearly and unambiguously stated that he is "in" bitcoin for the longrun, and he has backed that up with rationale and various sound money talking points - so he really seems to be quite an exception in terms of not ONLY getting what bitcoin is about, being well able to articulate what bitcoin is about and largely putting his money where his mouth is.

According to me, the reason why Saylor is really serious to invest for longterm because he has a lot of money and the trend of Bitcoin for longterm is profitable. Bitcoin is one of the best invention tech in financial and economic. For several century that we have passed from barter to crypto, this showed us the development of financial era. Saylor realised and consider that really interesting to support Bitcoin as part of society. His age is 56 years old, half of the Warren Buffet's age so it's normal if their thought about Bitcoin is really different because age showed us how the way we think. Talk about if someday Saylor will change his mind and be hypocrite, as far as we run together in crypto he always supports us to fight the fud. Thats enough.

[The Sceptical Chymist]

Basically, Microstrategty is the "armed arm" of Micheal Saylor, who can use the company as a private playground.

I wouldn't be too sure of that.  There have been companies that have kicked out the founder from the CEO position before, and if you think a CEO isn't accountable to his shareholders you'd be surprised what can happen when those shareholders begin to make noise.  It might look like Saylor has the board in his pocket, but he'd better watch out if bitcoin (or MSTR's share price) keeps dropping.  Mark my words.

Fortunately for him, bitcoin hasn't continued to sink even lower (yet), and if it recovers to $40k or so then all will probably be well--but we'll see.  It's too soon since bitcoin's price got chopped in half, and right now it looks like it could go either way.  I happen to think the bull market is nowhere near over, but I've been wrong so many times that I wonder why I even bother to predict what's going to happen with bitcoin.

If MSTR were shrewd, they'd hedge their bitcoin position in the futures market.  I don't know if they actually did that, but that's something a lot of corporations do with their investments.

[fillippone]

Basically, Microstrategty is the "armed arm" of Micheal Saylor, who can use the company as a private playground.

I wouldn't be too sure of that. 

I am pretty sure about this.
Micheal Saylor owns a special category of shares giving him almost the 70% of the voting power.

According to my spreadsheet, Micheal Saylor Owns 1,961,668 CLASS A MSTR shares, and an equal number of the unlisted B class shares, granting him 10x voting power.



With almost the 80% of the voting power it is really difficult to be ousted as a CEO, also, I am not familiar with corporate law in the US (no sarcasm here), but I guess this put him on a pretty protected position against lawsuits from minority shareholders.

[JayJuanGee]

but I've been wrong so many times that I wonder why I even bother to predict what's going to happen with bitcoin.

Surely there are needs for fine balancing whenever attempting to predict anything - especially when it involves the future and bitcoin

If MSTR were shrewd, they'd hedge their bitcoin position in the futures market.  I don't know if they actually did that, but that's something a lot of corporations do with their investments.

So far I have not heard anything about MSTR participating in any future's markets, and sure it could be within parameters of what they are already authorized to do, but they might have to disclose that too... especially if it might go beyond certain value numbers.. but if it is just small numbers they may not need to disclose because I think with any regulations there is going to be some discretion when working with values that do not constitute large percentages of overall value...

but you, The Pharmacist, seem to be suggesting that it would be prudent for MSTR to take even larger future positions to hedge against the seemingly large (out of this world range) long positions they already have taken, and if MSTR were taking the kinds of future positions that you seem to be suggesting to be prudent, then they would likely have to disclose such positions.  I am thinking that Saylor considers levels of prudence a wee bit differently than you, The Pharmacist.  For example, he has made pretty damned strong ass statements against diversification and hedging to assert that those are NOT smart moves once you have identified the winner (or leader) of a category, and surely Saylor has quite vigorously asserted that he believes bitcoin to be and above and beyond any other potential competitor in its area, and therefore there is no need to hedge in that kind of a way, which would also likely affect his thinking about futures, too... and sure, time will tell if he ends up being correct about the currently seeming strong positions that he has so far been taking in terms of bitcoin.

Basically, Microstrategty is the "armed arm" of Micheal Saylor, who can use the company as a private playground.

I wouldn't be too sure of that.  

I am pretty sure about this.
Micheal Saylor owns a special category of shares giving him almost the 70% of the voting power.

According to my spreadsheet, Micheal Saylor Owns 1,961,668 CLASS A MSTR shares, and an equal number of the unlisted B class shares, granting him 10x voting power.



With almost the 80% of the voting power it is really difficult to be ousted as a CEO, also, I am not familiar with corporate law in the US (no sarcasm here), but I guess this put him on a pretty protected position against lawsuits from minority shareholders.

Surely the facts seem to be on your side, fillippone, with this claim about pretty much unipotent (or is it omnipotent?) Saylor power in terms of his company, and probably the BIGGEST loophole that could undermine Saylor's position or put him in jeopardy would not be from various ways that votes might be conjured up whether talking about shareholders, investors, workers or any other category of stakeholder, but there is just the amorphous public company category that requires full and adequate disclosures to the public, which kind of gives me the sense that Saylor goes overboard on his public disclosure practices because he realizes that lacking in public disclosures would likely be his weakest link (achilles heel) if anyone were to attempt to play gotcha with him whether it were to be a shareholder, regulator or some other stakeholder trying to undermine him.

[Dabs]

Saylor did say more than once that he or the company need not sell any corns. Then can borrow against it and use it as collateral if they need cash or fiat. And as long as Bitcoin keeps going up (and it will, long term), then they can just keep borrowing against an appreciating asset.

It's going up forever Laura.

[fillippone]

Regarding CLASS A and CLASS B Microstrategy shares:

A lot of information can be found in the 10K Annual Report


In one paragraph you read:

Because of the rights of our two classes of common stock and because we are controlled by Michael J. Saylor, who beneficially owns the majority of our class B common stock, Mr. Saylor could transfer control of MicroStrategy to a third party without the approval of our Board of Directors or our other stockholders, prevent a third party from acquiring us, or limit the ability of our other stockholders to influence corporate matters
We have two classes of common stock: class A common stock and class B common stock. Holders of our class A common stock generally have the same rights as holders of our class B common stock, except that holders of class A common stock have one vote per share while holders of class B common stock have ten votes per share. As of February 2, 2021, holders of our class B common stock owned 1,964,025 shares of class B common stock, or 72.0% of the total voting power. As of February 2, 2021, Mr. Saylor, our Chairman of the Board of Directors & Chief Executive Officer, beneficially owned 1,961,668 shares of class B common stock, or 72.0% of the total voting power.
the stock market and the market for technology companies have experienced extreme price and volume
31
Accordingly, Mr. Saylor can control MicroStrategy through his ability to determine the outcome of elections of our directors, amend our certificate of incorporation and by-laws, and take other actions requiring the vote or consent of stockholders, including mergers, going-private transactions, and other extraordinary transactions and their terms.

This slightly differs from my computation but bear in mind that the data they are referring to is at EOY2020, while my computation reflect the most recent available data.

[buietaw]

That's pretty good news if it's a start.

 $ 250 million is a drop of water for this market. Nothing happens with one drop, we can even pierce the concrete with thousands of them 

[JayJuanGee]

That's pretty good news if it's a start.

 $ 250 million is a drop of water for this market. Nothing happens with one drop, we can even pierce the concrete with thousands of them 

Well if you had read various aspects of this thread, you would have seen that $250million was the initial purchase that was made by MSTR.. and their subsequent buys of BTC add somewhere in the territory of 2.2 billion in total...   And, not just strict buys but other involvements of both MSTR and also their CEO, Michael Saylor in terms of the bitcoin space including his own personal stash of BTC that he had disclosed at some point and also his various efforts to attempt to get other corporate treasuries to follow similar strategies of accumulating BTC with their treasuries.. maybe even some of the ideas and rationale behind buying and HODLing BTC to be rubbing off upon individuals, too.

MSTR has recently disclosed that they have more than 92k BTC that were purchased at an average price of more than $24k.. so that adds up to $2.2 billion that they invested into BTC.. and at today's prices their approximate current BTC stash is now valued at somewhere in the ballpark of more than $3.5 billion.. which would be 92,000 multiplied by $38,600... which yeah, surely is no drop of water.. and it adds up to some real value stashed away in BTC... and the story of MSTR and Michael Saylor's involvement is not going away and is not merely a product of a few actions, but several creative efforts that go beyond the parameters of the initial headline of this thread.

[oHnK]

That's pretty good news if it's a start.

 $ 250 million is a drop of water for this market. Nothing happens with one drop, we can even pierce the concrete with thousands of them  

Well if you had read various aspects of this thread, you would have seen that $250million was the initial purchase that was made by MSTR.. and their subsequent buys of BTC add somewhere in the territory of 2.2 billion in total...   And, not just strict buys but other involvements of both MSTR and also their CEO, Michael Saylor in terms of the bitcoin space including his own personal stash of BTC that he had disclosed at some point and also his various efforts to attempt to get other corporate treasuries to follow similar strategies of accumulating BTC with their treasuries.. maybe even some of the ideas and rationale behind buying and HODLing BTC to be rubbing off upon individuals, too.

MSTR has recently disclosed that they have more than 92k BTC that were purchased at an average price of more than $24k.. so that adds up to $2.2 billion that they invested into BTC.. and at today's prices their approximate current BTC stash is now valued at somewhere in the ballpark of more than $3.5 billion.. which would be 92,000 multiplied by $38,600... which yeah, surely is no drop of water.. and it adds up to some real value stashed away in BTC... and the story of MSTR and Michael Saylor's involvement is not going away and is not merely a product of a few actions, but several creative efforts that go beyond the parameters of the initial headline of this thread.

I have read that in the beginning when MTSR decided to invest in BTC, the CEO willn't sell their BTC for short term and keep them until 100 years. Yesterday my friend sent me the picture which showed the CEO Binance and MTSR will not sell their BTC, why they dont take profit? Then my friend asked me why they will not sell their BTC?

First, I answered that maybe because they are the main person behind crypto project. After that the conclusion of our discussion is BTC with promising potential can be used as collateral to borrow fresh money in business operational activities. On the other hand, BTC is also a guarantee that they can keep it.  Guarantee plus investment, isn't that a genius idea from this business leader?

[JayJuanGee]

That's pretty good news if it's a start.

 $ 250 million is a drop of water for this market. Nothing happens with one drop, we can even pierce the concrete with thousands of them  

Well if you had read various aspects of this thread, you would have seen that $250million was the initial purchase that was made by MSTR.. and their subsequent buys of BTC add somewhere in the territory of 2.2 billion in total...   And, not just strict buys but other involvements of both MSTR and also their CEO, Michael Saylor in terms of the bitcoin space including his own personal stash of BTC that he had disclosed at some point and also his various efforts to attempt to get other corporate treasuries to follow similar strategies of accumulating BTC with their treasuries.. maybe even some of the ideas and rationale behind buying and HODLing BTC to be rubbing off upon individuals, too.

MSTR has recently disclosed that they have more than 92k BTC that were purchased at an average price of more than $24k.. so that adds up to $2.2 billion that they invested into BTC.. and at today's prices their approximate current BTC stash is now valued at somewhere in the ballpark of more than $3.5 billion.. which would be 92,000 multiplied by $38,600... which yeah, surely is no drop of water.. and it adds up to some real value stashed away in BTC... and the story of MSTR and Michael Saylor's involvement is not going away and is not merely a product of a few actions, but several creative efforts that go beyond the parameters of the initial headline of this thread.

I have read that in the beginning when MTSR decided to invest in BTC, the CEO willn't sell their BTC for short term and keep them until 100 years. Yesterday my friend sent me the picture which showed the CEO Binance and MTSR will not sell their BTC, why they dont take profit? Then my friend asked me why they will not sell their BTC?

First, I answered that maybe because they are the main person behind crypto project. After that the conclusion of our discussion is BTC with promising potential can be used as collateral to borrow fresh money in business operational activities. On the other hand, BTC is also a guarantee that they can keep it.  Guarantee plus investment, isn't that a genius idea from this business leader?

Your lumping together of various business leaders and even not really specifying which kind of business you are talking about comes off as a bit confusing, oHnK.

Of course, this thread is mostly about MSTR and even Michael Saylor is a pretty dominant leader in that business, so surely when this thread started in August 2020, Saylor was pretty damned new to bitcoin, but he had gotten into bitcoin fairly aggressively and fairly openly with a lot of appearances on podcasts and various other seemingly bitcoin evangelizing type activities.  In the past, week or so I have not seen any announcement from him regarding further bitcoin purchases, yet I would imagine that such an announcement is pending - especially given that he had announced several purchases in the supra $50k territories in the past couple of months on about a monthly basis, if not more frequently sometimes... so surely this time around - if their cash has still been coming in or if they have any extra cashflow for the month of May or June or however they calculate their timeframes for BTC purchases, I would expect quite lower lower than $50k per BTC purchases and an ability to have acquire more BTC per dollar.. maybe in the mid to lower $30ks.. which would still end up being higher than their overall average price per BTC which is currently a bit over $24k from the latest announcement that I had seen on the topic.

Now your mentioning of CZ of Binance seems to be a bit of a different comparison, even though surely CZ and Saylor share several ideas in common in terms of generally being bullish about bitcoin, but CZ runs a kind of unique kind of exchange that both gets involved in a lot of shitcoins, and surely Saylor has so far been bitcoin only.

Your amorphous reference to other CEOs comes off as quite vague too because surely CEOs can be all over the place in terms of both the kinds of businesses they run and whether they understand and/or appreciate bitcoin as either something to involve their business in or to involve their treasuries in.

I have no problem with your statement that most businesses would likely be advantaged by having some kind of bitcoin accumulation approach, but surely even currently there do not seem to be a lot of businesses that are either taking investment into bitcoin seriously in terms of how they think about a possible role of bitcoin in their company or their treasuries nor are many businesses seeming to take actual actions to either involve themselves in bitcoin or to take it on into their treasuries - which largely shows that we are still quite early days in bitcoin that's for sure.

[fillippone]

Microstrategy has another go at the institutional market:




https://twitter.com/michael_saylor/status/1401879767943729154?s=21

Of course, the relevant part of the news is the following one:

MicroStrategy intends to use the net proceeds from the sale of the notes to acquire additional bitcoins.

but also the detail on the newly formed company just to hold the coins: Macrostrategy.

MicroStrategy’s existing approximately 92,079 bitcoins will be held by a newly formed subsidiary, MacroStrategy LLC.

It is not immediately clear why Microstrategy want to create a new company (that would presumedly be 100% owned by Microstrategy) to hold his bitcoins.

On a separate note Bloomberg reports that Microstrategy reported some impairments today:

MicroStrategy Is Selling Corporate Bonds to Buy Bitcoin

MicroStrategy, in a separate filing, said that it’s taking a roughly $284.5 million charge during its next earnings report thanks to losses related to fluctuations in the price of the digital asset. That amounts to more than its cumulative earnings since 2011.

Here is the filing:

On June 7, 2021, MicroStrategy Incorporated (the “Company”) disclosed the following information: based on the fluctuations in market price of bitcoin during the second quarter of 2021 through the date of this Current Report on Form 8-K, the Company expects to incur an impairment loss of at least $284.5 million related to its bitcoin for the three months ending June 30, 2021.

Source

Everybody is good at holding when the prices go right. Only brave men can hold when prices go left.

[titular]

First, the news:

MicroStrategy Adopts Bitcoin as Primary Treasury Reserve Asset

TYSONS CORNER, Va.--(BUSINESS WIRE)--MicroStrategy® Incorporated (Nasdaq: MSTR), the largest independent publicly-traded business intelligence company, today announced that it has purchased 21,454 bitcoins at an aggregate purchase price of $250 million, inclusive of fees and expenses. The purchase of Bitcoin cryptocurrency was made pursuant to the two-pronged capital allocation strategy previously announced by the company when it released its second quarter 2020 financial results on July 28, 2020.

Source link: https://www.businesswire.com/news/home/20200811005331/en/MicroStrategy-Adopts-Bitcoin-Primary-Treasury-Reserve-Asset

This is the main statement:

“Our investment in Bitcoin is part of our new capital allocation strategy, which seeks to maximize long-term value for our shareholders,” said Michael J. Saylor, CEO, MicroStrategy Incorporated. “This investment reflects our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash. Since its inception over a decade ago, Bitcoin has emerged as a significant addition to the global financial system, with characteristics that are useful to both individuals and institutions. MicroStrategy has recognized Bitcoin as a legitimate investment asset that can be superior to cash and accordingly has made Bitcoin the principal holding in its treasury reserve strategy.”

Coindesk realunched the news:


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

Publicly traded business intelligence firm MicroStrategy purchased 21,454 bitcoin on Tuesday, effectively pouring all $250 million of its planned inflation-hedging funds into the digital currency.

• Disclosing its bitcoin buy alongside an equivalent stock buyback in a Tuesday Securities and Exchange Commission filing, MicroStrategy, a Nasdaq-listed software firm worth over $1.2 billion, said the cryptocurrency provided a "reasonable hedge against inflation" in a press statement shared with CoinDesk.
• “This investment reflects our belief that bitcoin, as the world’s most widely adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash," said CEO Michael J. Saylor.
• Saylor cited forces working to weaken fiat currencies – COVID-19, global quantitative easing measures, political and economic uncertainty – but also the technical and qualitative aspects that he said give the bitcoin blockchain strength.
• “We find the global acceptance, brand recognition, ecosystem vitality, network dominance, architectural resilience, technical utility and community ethos of bitcoin to be persuasive evidence of its superiority as an asset class for those seeking a long-term store of value," Saylor said.
• The capital allocation quickly fulfills Saylor's late July promise to shareholders that his company, which he founded in 1989, would buy back $250 million in stock and invest an additional $250 million in gold and bitcoin over the next 12 months. The belief was that these and other "alternative investments" would protect MicroStrategy's dollar-heavy balance sheet.
• It is now clear that half of the $500 million bet turns entirely on bitcoin. MicroStrategy "accordingly has made bitcoin the principal holding in its treasury reserve strategy," Saylor said.

Source link: https://www.coindesk.com/microstrategy-bitcoin-buy-protects-against-fiat-inflation


My Commentary:
This is so big: A publicly traded  firm decided to invest half of his 500 millions excess cash reserves buying bitcoin, deliberately dumping the ever value loser, inflationary, exponentially printed fiat currency, to embrace the superior hard money, digital gold, Bitcoin.
This is so bullish. A new era for Bitcoin in the path of a recognition as a superior Store Of Value.


A few tweet about this:

Gabor Gurbacs

Publicly traded company MicroStrategy adopts #Bitcoin as a treasury reserve asset to hedge against fiat inflation. MicroStrategy  allocates $250mm to Bitcoin. This is a big deal and good to see #Bitcoin used as intended: hard money/savings instrument.

https://twitter.com/gaborgurbacs/status/1293153751549784064

PlanB

#Phase5

https://twitter.com/100trillionUSD/status/1293174076299673600?s=20

I look forward to seeing his next big purchase.

[JayJuanGee]

[edited out]

Why are you, titular, quoting the OP, 10 months after the fact - with also 18 pages of posts in this thread - which your reference and comment seems to be suggesting that the contents of the OP is the ONLY thing that has happened in the MSTR buying bitcoin department?

Have you read any other post in the thread?  Have you any clue about what is going on in connection with the topic of this thread? or anything else going on in connection to bitcoin now or in the previous 10 months?

Even the latest of the posts in this thread could have given you a weee bit of a clue, perhaps?  Are you even capable of absorbing any kind of a clue beyond what seems to be your ability to create subject-matter clutter and distraction?

[fillippone]

Microstrategy today priced and sold its new bonds. As they got a 1.6 Billion bid (4x the offering size) they decided to uptick the total size to 500 Millions:

MicroStrategy Announces Pricing of Offering of Senior Secured Notes

TYSONS CORNER, Va., June 8, 2021 — MicroStrategy® Incorporated (Nasdaq: MSTR) (“MicroStrategy”) today announced the pricing of its offering of $500 million aggregate principal amount of senior secured notes due 2028 (the “notes”), which will bear interest at an annual rate of 6.125%. The notes will be sold in a private offering to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”) and to persons outside of the United States in compliance with Regulation S under the Securities Act. The offering is expected to close on June 14, 2021, subject to satisfaction of customary closing conditions.

As it happened in the past, I doubt they will have to keep the offering open until 14th of June to fill the size.

MicroStrategy’s existing bitcoins as well as bitcoins and digital assets acquired with the proceeds from existing bitcoins.  MicroStrategy’s existing approximately 92,079 bitcoins will be held by a newly formed subsidiary, MacroStrategy LLC.

MicroStrategy estimates that the net proceeds from the sale of the notes and the related guarantees will be approximately $488 million, after deducting initial purchaser discounts and commissions and estimated offering expenses payable by MicroStrategy. MicroStrategy intends to use the net proceeds from the sale of the notes to acquire additional bitcoin.

TWo information here:

• The bitcoins will be held into a new custody company: Macrostrategy
• The proceeds of a 500 Million bond are around 488. A 2.4% cut is not negligible in fixed income during these days. I guess who the arrangers are
• These proceeds will anyway enough to buy an additional 14.500 BTC, totalling a gargantuan 100K+ account held in MSTR.
  
• As soon as my RL will allow, I will compile a list of the various debt issues from MSTR

[arallmuus]

As they got a 1.6 Billion bid

Thats alot, please enlighten me on this as I might be missing something. Why would people put this much money on a company that will purchase bitcoins instead of just purchasing their own bitcoins?

Also Is there any additional information regarding the specific buy price range for Microstrategy i.e anything below 31k so that the price wont go anything lower than 30k as currently 30k seems like the major support for bitcoins or are they just going to scoop up those bitcoins right of the market at the current price ?