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

[348Judah]

the decline that is happening now this doesn't deter saylor from investing again and even a 3 day ago they announced another purchase of 480 bitcoins or equivalent with $10 milions.

In general, the idea of buying and not selling is in itself reassuring to the markets, but these people invest in the long-term, so these currencies will be sold within 10 to 20 years, and therefore unless they are forced, there is no reason to sell them.

Of no doubt microstrategy has it best strategy inplace for the bitcoin market and price, they can't just persists on making buys without considering some quogent areas, long term bitcoin investment is one of the most secured ways for the future in cryptocurrency considering it previous history right from inception, from the year 2009 till date and it past events record could attest to the certainty for a rising in price.

Bitcoin does not need to get to ATH for Saylor to be profitable from BTC and/or to even had made a good investment decision by putting money into bitcoin.

Aside from bitcoin being use as digital currency for exchange there are other applicable aspect where bitcoin has more advantage it serves it's investors such as, store of value, decentralized digital assets, profitable investment, medium of exchange and the likes.

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[JayJuanGee]

Don't you see that Saylor is already panicking by being so whimpy with his additional purchases of ONLY $10 million?  He flinched, no?  He's showing weakness?  and lack of confidence, no?

He is partly afraid of making bigger purchase but he doesnt want to stop purchasing it otherwise alot of people would question his confidence in all of his bitcoin holdings. Pretty sure that we will get alot more small size purchase like this in the upcoming weeks unless btc somehow climb up to 30k or something then he might be confident afterward to make bigger purchase

or unless he is almost out of cash for now therefore making smaller purchases

Of course, my statement that you cited was meant a bit tongue in cheek - which means that it was a bit of an exaggeration, and even though Saylor likely is a bit disappointed with BTC's price drops of the last month or more, I doubt that his confidence would have really been shaken in any kind of substantial and/or meaningful way... so maybe that is one of the difficulties in my making those kinds of statements . .because the baloney propaganda continues to be "concerned" about the level of Saylor's ongoing conviction in regards to his already made bitcoin purchases - averaging higher prices.

[fillippone]

or unless he is almost out of cash for now therefore making smaller purchases

I think this is the right reason.

Microstrategy as a company is basically a zombie company. Have you ever heard of a Microstrategy product before it became known for their bitcoin investment? Me neither.

The vast majority of his buys have been made against issue of new debt or equity. I guess the small buys of 10sh millions are financed from cash flows from company converted into bitcoin.
I guess this is pretty evident from the spreadsheet where I kept track of the source of every buy via a colour coding.

[fillippone]

Micheal Saylor is pushing the “bitcoin strategy” narrative:





As a bonus, an earlier version of the same tweet, now deleted:

[Daltonik]

In the second quarter, Tesla got rid of most of its bitcoin reserves by selling 75% of the available ones, now the crypto assets on Tesla's balance sheet amount to $218 million, at one time Michael Saylor thanked Musk for buying bitcoin for $1.5 billion.

However, according to Musk, this is a forced measure to overcome difficulties due to covid problems in China, and not a sentence to bitcoin.
Source link: https://www.theguardian.com/technology/2022/jul/20/tesla-second-quarter-earnings-elon-musk

The state of the global economy should eventually force the largest companies to change their attitude to bitcoin, for example, BlackRock, which lost $1.7 trillion at the end of the 2nd quarter of this year, is no longer so opposed to investing in bitcoin.

Source link: https://watcher.guru/news/bitcoin-averse-blackrock-loses-1-7-trillion-in-6-months
                  https://www.bloomberg.com/opinion/articles/2022-07-20/how-blackrock-lost-1-7-trillion-in-six-months#xj4y7vzkg
Archived bloomberg Link: https://archive.ph/SxS7a

Upd: Michael Saylor's comment on Tesla's bitcoin sale:

https://twitter.com/saylor/status/1549856625321807873

[The Sceptical Chymist]

What important information am I missing in that tweet?  Is it just a blatantly autistic response to Musk's sale, or is there more to it?  This is one thing that bugs me about e-mails, posts, tweets, and basically all forms of written communication: it's very hard to determine the tone of what you're reading.  I don't know if he's being sarcastic or whatever else; it just looks like a weird tweet to me.

But boy, I'm happy for Michael Saylor that bitcoin didn't (or hasn't yet) continue to drop.  He must have been sweating just a little bit when it fell below $20k, no matter how stoic he appears in interviews.  MSTR's stock hasn't overreacted to bitcoin's price, either.

[Daltonik]

What important information am I missing in that tweet?  Is it just a blatantly autistic response to Musk's sale, or is there more to it?  This is one thing that bugs me about e-mails, posts, tweets, and basically all forms of written communication: it's very hard to determine the tone of what you're reading.  I don't know if he's being sarcastic or whatever else; it just looks like a weird tweet to me.

But boy, I'm happy for Michael Saylor that bitcoin didn't (or hasn't yet) continue to drop.  He must have been sweating just a little bit when it fell below $20k, no matter how stoic he appears in interviews.  MSTR's stock hasn't overreacted to bitcoin's price, either.

Yes, the people under this Michael Saylor tweet began to develop the topic around the ratio of the% indicated by him, well, the context of the tweet is, as it seems to me, regret about what happened, because it is likely that the moment will come when the remaining 25% will cost much more than the 75% that Musk sold.

[JayJuanGee]

What important information am I missing in that tweet?  Is it just a blatantly autistic response to Musk's sale, or is there more to it?  This is one thing that bugs me about e-mails, posts, tweets, and basically all forms of written communication: it's very hard to determine the tone of what you're reading.  I don't know if he's being sarcastic or whatever else; it just looks like a weird tweet to me.

But boy, I'm happy for Michael Saylor that bitcoin didn't (or hasn't yet) continue to drop.  He must have been sweating just a little bit when it fell below $20k, no matter how stoic he appears in interviews.  MSTR's stock hasn't overreacted to bitcoin's price, either.

It seems to me that stating the fact that selling 75% of your BTC results in ONLY having 25% of what BTC that you used to have is a reminder of the importance of building a BTC position.. I understand that it is not really saying anything, it is like if someone does or says something that you may agree with or you don't agree with, and you merely assert, "that was an interesting choice."  You have not really said anything, but you acknowledged that you know that something had happened.  

You can agree with Saylor's largely making of neutral statements or not.. it still serves as a reminder that people noticed that Musk sold 75% of his stash.. and people will likely notice again down the road whether such selling of 75% ended up working out well or not... Time will tell.. Time will tell.. and sure, Musk/TESLA might take some actions in the meantime in terms of buying some or all of the sold BTC back,,, Perhaps? perhaps?.

[Don Pedro Dinero]

It seems to me that stating the fact that selling 75% of your BTC results in ONLY having 25% of what BTC that you used to have is a reminder of the importance of building a BTC position.. I understand that it is not really saying anything, it is like if someone does or says something that you may agree with or you don't agree with, and you merely assert, "that was an interesting choice."  You have not really said anything, but you acknowledged that you know that something had happened.  

Michael Saylor is a salesman, or I should say a snake oil salesman. When Musk bought, he sold it as good news, and now that Musk is selling, he wants to sell it as good news too, or at least as neutral or not so bad.

For me this is bad news, because this cycle was known as the institutional adoption cycle, and if Tesla has sold to obtain liquidity, I wonder if there are other companies that are not nearly as famous that have also sold but without appearing in the news, as in this case.

[JayJuanGee]

It seems to me that stating the fact that selling 75% of your BTC results in ONLY having 25% of what BTC that you used to have is a reminder of the importance of building a BTC position.. I understand that it is not really saying anything, it is like if someone does or says something that you may agree with or you don't agree with, and you merely assert, "that was an interesting choice."  You have not really said anything, but you acknowledged that you know that something had happened.

Michael Saylor is a salesman, or I should say a snake oil salesman. When Musk bought, he sold it as good news, and now that Musk is selling, he wants to sell it as good news too, or at least as neutral or not so bad.

You can consider the matter in any way that you like, and if you believe that Saylor is trying to sell bitcoin upon people rather than educate people about bitcoin, then that is your choice to see the matter like that... and maybe with the passage of time, you will be proven to be correct.  Alternatively, you could be proven to be wrong.. in the sense that bitcoin is not snake oil, even if you personally believe bitcoin to be lacking in substance.

No one can cause you to do your research and to come to any conclusion other than the conclusion that you have chosen to see for yourself.

For me this is bad news, because this cycle was known as the institutional adoption cycle, and if Tesla has sold to obtain liquidity, I wonder if there are other companies that are not nearly as famous that have also sold but without appearing in the news, as in this case.

If you really consider the matter, the adoption of bitcoin and the various network effects of bitcoin have been building for the past 13.5 years.  Sure, there are way more institutions coming into bitcoin in recent times, and quite likely there were way smaller institutions in bitcoin for many years back.  If you want to create a defeatest attitude and frame bitcoin as if it were failing in adoption, then again you may well be proven to be correct, but then again, you may well be proven to be incorrect.

I doubt anyone is going to convince you to account for facts before you reach your conclusions that bitcoin is not growing as fast as you believe that it should grow.

Even if you were to try to figure out the extent to which bitcoin's network effects are growing or not, you could spend a whole hell of a long time studying each of the network effects, and still you may well end up coming to your own conclusion, in which you believe that bitcoin is not growing as fast as you believe that it should be growing.  No one is going to stop you from being a no coiner or a low coiner based on your various likely to be false assumptions.

One of the earlier frameworks for network effects came from Trace Mayer, and surely there has been a lot of discussions around various aspects of how bitcoin becomes more powerful and even unstoppable by ongoing building of network effects.

[fillippone]

The quarter has ended, and it's time to recap on the effect of this Bitcoin Dip on Microstrategy balance sheet.
This is my projection:



They are going to report on Aug 2, after the bell.

[DU18]

Yes, the people under this Michael Saylor tweet began to develop the topic around the ratio of the% indicated by him, well, the context of the tweet is, as it seems to me, regret about what happened, because it is likely that the moment will come when the remaining 25% will cost much more than the 75% that Musk sold.

Tesla and elon musk have shown us how much he believes in bitcoin , all this time he kept saying that bitcoin is the asset of the future but actually he has sold almost 75% of the bitcoins they have now, So do you still believe that elon musk is a man who believe in bitcoin?
But I don't know, we don't know what is on Elon Musk's mind right now because maybe this is his strategy to profit and give negative issues to bitcoin so that later he can buy again when the price drops after the bitcoin sale.

[fillippone]

Tesla and elon musk have shown us how much he believes in bitcoin , all this time he kept saying that bitcoin is the asset of the future but actually he has sold almost 75% of the bitcoins they have now, So do you still believe that elon musk is a man who believe in bitcoin?

I don’t know and I don’t care about what Elon thinks about bitcoin.
What I know is that I believe in the Bitcoin, and that Elon sold because he needed a positive cash flow in his balance.
That’s it. No heroes.

[m2017]

Tesla and elon musk have shown us how much he believes in bitcoin , all this time he kept saying that bitcoin is the asset of the future but actually he has sold almost 75% of the bitcoins they have now, So do you still believe that elon musk is a man who believe in bitcoin?

I don’t know and I don’t care about what Elon thinks about bitcoin.

There would be more such people who ignore the opinion of public figures, like Elon. This would reduce the level of manipulation of public opinion.

What I know is that I believe in the Bitcoin, and that Elon sold because he needed a positive cash flow in his balance.
That’s it. No heroes.

Of course, Elon acts purely in his personal interests, and the sale by Tesla of 75% bitcoins is no exception.

What do we care what Elon believes in: bitcoin, doge, or something else. What matters is what each individual believes in. In this case, does he believe in bitcoin.

[Oluwa-btc]

Must have said some stuffs bout him( Elon Musk's ) But, he is a very smart and Intelligent person, taken such decisions are for him and the company you know. As said they needed fiat which was more affordable and available for them since they layed off some of them workers.

 I feel they are currently carrying out experiments on holding Bitcoin which shouldn't bother anyone one to panic sell. Also if you notice, selling those Bitcoins didn't affect the market and Bitcoin price in anyway ( But even if it did,get those available fiat currencies and buy those little SATs )

The more one is focused on Bitcoin the more you tend to see the futuristic views bout it. Avoid those fiat currencies that are not backed by anything, just the government which we all have seen how the fiat currencies have and has failed in the turbulent times.
It clear enough, if you're investing in Bitcoin to get it back after a month it's kinda a bit bad, Bitcoin should really be held for like 10+ years and above. Don't be carried away by what happened, the media won't speak about how the fiat currencies have failed humans truthfully.
See that Bitcoin is the Fvckn Bigger Picture.

[Pesona1]

Yes, the people under this Michael Saylor tweet began to develop the topic around the ratio of the% indicated by him, well, the context of the tweet is, as it seems to me, regret about what happened, because it is likely that the moment will come when the remaining 25% will cost much more than the 75% that Musk sold.

Tesla and elon musk have shown us how much he believes in bitcoin , all this time he kept saying that bitcoin is the asset of the future but actually he has sold almost 75% of the bitcoins they have now, So do you still believe that elon musk is a man who believe in bitcoin?
But I don't know, we don't know what is on Elon Musk's mind right now because maybe this is his strategy to profit and give negative issues to bitcoin so that later he can buy again when the price drops after the bitcoin sale.

All this time we have always been waiting for sweet tweets from elon musk that might affect crypto movements such as bitcoin and doge, but now what elon is doing is really quite painful in my opinion, realize it or not, elon musk does have a strong influence on the development of crypto including the idea of ​​being the first to accept Tesla payments with bitcoin and I think that at that time Elon speech about adoption of bitcoin had opened the eyes of the world, especially large companies to glance at bitcoin.

[salad daging]

Tesla and elon musk have shown us how much he believes in bitcoin , all this time he kept saying that bitcoin is the asset of the future but actually he has sold almost 75% of the bitcoins they have now, So do you still believe that elon musk is a man who believe in bitcoin?

I don’t know and I don’t care about what Elon thinks about bitcoin.
What I know is that I believe in the Bitcoin, and that Elon sold because he needed a positive cash flow in his balance.
That’s it. No heroes.

I don't think so, I can't believe Elon Musk's influence on bitcoin he needed during the hype alone.

But what I believe is Michael Saylor who is steadfastly consistent with bitcoin and so fully believes in what he does in his MicroStrategy investments.

Just look at the tweets he's still cheerful with bitcoin and a bitcoin maximalist.

I believe it must be within me.

[fillippone]

But what I believe is Michael Saylor who is steadfastly consistent with bitcoin and so fully believes in what he does in his MicroStrategy investments.

Same thing with Micheal Saylor. He has to prove his strategy valid, so he must keep this "Bitcoin Maximalist" stance in order not to scare Microstrategy's investors.



This is why there is a constant stream of upbeat tweets.

[Upgrade00]

Same thing with Micheal Saylor. He has to prove his strategy valid, so he must keep this "Bitcoin Maximalist" stance in order not to scare Microstrategy's investors.

I think, investors should typically not be influenced by optimistic tweets, but rather figures. Saylor did share some figures recently about how Bitcoin coped when compared to other assets since microstrategy bought in; doesn't reflect their personal numbers, as they have bought at different times over the past months, but it shows the market is not as bad when compared with other markets.

This is why there is a constant stream of upbeat tweets.

IIRC, the plan was to hold for 100 years, so if the market goes well, he should not need to defend the investment after the next 5-10 years

[fillippone]

Microstrategy published its quarterly Filing.
Pretty much intense:



Firstly, the news:

Micheal Saylor is stepping down as CEO. He will retain the Chairman title:

TYSONS CORNER, Va., August 2, 2022 - MicroStrategy® Incorporated (Nasdaq: MSTR) (“MicroStrategy” or the “Company”), the largest independent publicly-traded business intelligence company, announced today that, as of August 8, 2022, Michael Saylor will assume the new role of Executive Chairman and Phong Le, the Company’s President, will also serve as the Company’s new Chief Executive Officer and as a member of the Board of Directors. Mr. Saylor will remain the Chairman of the Board of Directors and an executive officer of the Company.

As per financial highlight, my forecast was quite on point:

Second Quarter 2022 Financial Highlights

• Revenues: Total revenues for the second quarter of 2022 were $122.1 million, a 2.6% decrease, or a 1.7% increase on a non-GAAP constant currency basis, compared to the second quarter of 2021. Product licenses and subscription services revenues for the second quarter of 2022 were $34.1 million, a 5.1% increase, or an 8.4% increase on a non-GAAP constant currency basis, compared to the second quarter of 2021. Product support revenues for the second quarter of 2022 were $66.5 million, a 6.3% decrease, or a 2.1% decrease on a non-GAAP constant currency basis, compared to the second quarter of 2021. Other services revenues for the second quarter of 2022 were $21.4 million, a 1.9% decrease, or a 4.3% increase on a non-GAAP constant currency basis, compared to the second quarter of 2021.
• Gross Profit: Gross profit for the second quarter of 2022 was $96.9 million, representing a 79.4% gross margin, compared to a gross profit of $102.3 million, representing a gross margin of 81.6%, for the second quarter of 2021.
• Operating Expenses: Operating expenses for the second quarter of 2022 were $1.015 billion, a 96.5% increase compared to the second quarter of 2021. Operating expenses include impairment losses on MicroStrategy’s digital assets, which were $917.8 million during the second quarter of 2022, compared to $424.8 million in the second quarter of 2021.
• Loss from Operations and Net Loss: Loss from operations for the second quarter of 2022 was $918.1 million, compared to $414.2 million for the second quarter of 2021. Net loss for the second quarter of 2022 was $1.062 billion, or $94.01 per share on a diluted basis, as compared to $299.3 million, or $30.71 per share on a diluted basis, for the second quarter of 2021. Digital asset impairment charges of $917.8 million and $424.8 million for the second quarter of 2022 and 2021, respectively, were reflected in these amounts.
• Cash and Cash Equivalents: As of June 30, 2022, MicroStrategy had cash and cash equivalents of $69.4 million, as compared to $63.4 million as of December 31, 2021, an increase of $6.0 million.
• Digital Assets: As of June 30, 2022, the carrying value of MicroStrategy’s digital assets (comprised of approximately 129,699 bitcoins) was $1.988 billion, which reflects cumulative impairment losses of $1.989 billion since acquisition and an average carrying amount per bitcoin of approximately $15,326. As of June 30, 2022, the original cost basis and market value of MicroStrategy’s bitcoin were $3.977 billion and $2.451 billion, respectively, which reflects an average cost per bitcoin of approximately $30,664 and a market price per bitcoin of $18,895.02, respectively. Additional information on MicroStrategy’s digital asset holdings is included in the “Digital Assets – Additional Information” tables at the end of this press release.

Here's the presentation Result



I will comment on the main result in the following posts.