Is Michael Saylor’s Bitcoin Strategy Genius or Reckless?

[asriloni]

His average price is $75,000. Not the best return considering he started buying 5 years ago. He blew his load borrowing money and smash buying as much as 20k BTC/week at the top in the $110-$120k range. He literally was trying to pump the price himself. Which he did. He's desperately trying to keep BTC from falling below that number.

His pump pump strategy is no longer worth it. Just like his last bought that gave no impact to driven the price of BTC to go up. At this point, i think he's getting trapped by his own strategy. The more Bitcoin he buys, the more dump faces by his company stock. If his company collapse, FTX will not even close to it.

[BlackBoss_]

His pump pump strategy is no longer worth it. Just like his last bought that gave no impact to driven the price of BTC to go up. At this point, i think he's getting trapped by his own strategy. The more Bitcoin he buys, the more dump faces by his company stock. If his company collapse, FTX will not even close to it.

I don't consider his strategy is pump and pump. It's accumulation for long term profit as you can see Strategy started to buy bitcoin on September 14 2020 and they have accumulated bitcoin since then through the latest bear market. They did not buy bitcoins in a bear market to make any pump and they actually did many purchases since 2020.

It's DCA strategy but it contains risk by leveraging too much. Saylor and Strategy will actually need to rebalance their company treasury, slow down their bitcoin accumulation for reducing risk and making their Bitcoin treasury more sustainable with time. They are already ahead many institutional investors in Bitcoin market and it's right time for them to cool down their greediness and prioritize safety.

[Free Market Capitalist]

I don't consider his strategy is pump and pump. It's accumulation for long term profit as you can see Strategy started to buy bitcoin on September 14 2020 and they have accumulated bitcoin since then through the latest bear market. They did not buy bitcoins in a bear market to make any pump and they actually did many purchases since 2020.

If you had bothered to read before writing, you would know that Saylor uses the worst possible form of DCA.

Yes, Saylor buys a lot of Bitcoin, but you have to look at how he does it.

...

With Saylor's strategy, he has only achieved a 15% return on the Bitcoin he has purchased, because he uses a crappy reverse DCA where he buys a lot, huge amounts when the price breaks ATHs, and little or nothing when it drops.

It's DCA strategy but it contains risk by leveraging too much.

False, that's not Strategy's problem. Its debt-to-equity ratio is quite healthy; it's at a low level.

I won't even comment on the other thing you said, because it's clear that you don't know how the company works.

[free-bit.co.in]

Michael Saylor's Bitcoin buying strategy is quite ingenious, as it partially replicates the patterns of the DCA strategy, which allows you to buy Bitcoin over a certain period of time. Ultimately, it appears to have been purchased at some absolute average price.
Currently, Michael Saylor's Bitcoin purchases average $75,000, which is already significantly lower than the current Bitcoin-to-dollar market price. This means he can confidently say he's profitable, and you can even calculate this profit based on the current Bitcoin price and the average purchase price I mentioned above, $75,000.

Currently, Bitcoin is trading in the range of $90k. This means that after 5 year of investing in bitcoin and DCA, Strategy's profit reached approximately 20%. They are still making a profit, but do you think it is a good profit? To be honest, for me, this is not a good profit.

He is using DCA, and there is nothing wrong with that. But the problem is that instead of investing with his existing capital, he is using leverage to invest in bitcoin. That makes their investment strategy in bitcoin somewhat risky.

[Rustam Meraj]

This is far safer way when a CEO such as Saylor has access to huge money, but is very dangerous one when dealing with normal investors who might risk huge losses in case of fast drop in Bitcoin price. In my mind, key year will be 2026, in case Bitcoin will reach a price of over 150,000, Saylor will be seen as genius, whereas in case value will stay flat and his debts will keep going, he will be forced to sell finally, and it will be proof that belief turns reckless as soon as you are no longer able to survive long crash of market.

It can be seen that Saylor continues adding more after purchasing another 1,286 BTC this week. Nevertheless, stock of Strategy is currently priced at lower price than Bitcoin that it holds, showing that market is beginning to be worried. According to my view, safety buffer of cash that Saylor has is only thing protecting him at present otherwise he would be exactly what Schiff says he is, namely, gambler awaiting crash.

[tvplus006]

Michael Saylor’s strategy has been one of the most talked-about in the cryptocurrency space. His approach is basically to “buy all the Bitcoin sellers are willing to sell” and commit to holding long term. No hedging. No trading. Just conviction...

Given the fact that bitcoin is not bought with borrowed funds, but with money received from the sale of shares, Michael Saylor's strategy has no risk for Strategy. The main thing is that shareholders receive their dividends on time, for which a special fund of about $ 2 billion has already been formed.

[PrivacyG]

It can be seen that Saylor continues adding more after purchasing another 1,286 BTC this week. Nevertheless, stock of Strategy is currently priced at lower price than Bitcoin that it holds, showing that market is beginning to be worried.

It is not only reckless to his own company and strategy but reckless to all of us considering the size of his Wallet.  If he needs to sell a lot of Bitcoin in the future, the entire Market will be in trouble.  Not for ever of course, but for a decent amount of time for sure.  I do not know how and why other people are happier every time he announces a purchase.  If there is a feeling growing in me every time he does it, it is the feeling of worry.

[Bbluez]

His average price is $75,000. Not the best return considering he started buying 5 years ago. He blew his load borrowing money and smash buying as much as 20k BTC/week at the top in the $110-$120k range. He literally was trying to pump the price himself. Which he did. He's desperately trying to keep BTC from falling below that number.

His pump pump strategy is no longer worth it. Just like his last bought that gave no impact to driven the price of BTC to go up. At this point, i think he's getting trapped by his own strategy. The more Bitcoin he buys, the more dump faces by his company stock. If his company collapse, FTX will not even close to it.

He’s playing a long game and he's ready for it. That's why it's called pump and pump. The future is bright for Bitcoin.

[Synchronice]

Michael Saylor’s strategy has been one of the most talked-about in the cryptocurrency space. His approach is basically to “buy all the Bitcoin sellers are willing to sell” and commit to holding long term. No hedging. No trading. Just conviction.

Peter Schiff disagrees with Saylor’s view of Bitcoin as “digital gold.” He argues that Bitcoin is extremely volatile and cannot serve as a hedge against inflation.

Peter Schiff can disagree with anything he wishes but facts speak themselves. MicroStrategy's investments in Bitcoin have shown a phenomenal result. How can Peter Schiff deny that Bitcoin is a digital gold when countries all over the world work on creating a Bitcoin strategic reserves? Peter Schiff is simply an anti-Bitcoin guy who tries to gain attention with his anti-Bitcoin sentences, it's all plan of the self-marketing.

And will Saylor ultimately be proven right or wrong in the near future?

Just check the price in the next few years. He is definitely right!

[Richbased]

The real question is:
At what point does a conviction play become reckless? And will Saylor ultimately be proven right or wrong in the near future?

Is Saylor reckless with his bitcoin investment? yes he is and there is nothing wrong if a person chooses to ride and die in any investment. Risk management is good but for how long should we keep being afraid of investments that has potential value in them. Even in an ordinary investment that most people do in real life, it still involves great risks especially the ones that we trust so much and have been making profits from them over the years so why should an investor like Michael Saylor be skeptical about the future of bitcoin?

Whether Saylor is proven right or wrong, it's no one's investment but his and let us not forget that this is a man that once talked down on bitcoin and suddenly he is now one of the highest hodlers so it tells that he is not afraid of any uncertainty.

[Bbluez]

The real question is:
At what point does a conviction play become reckless? And will Saylor ultimately be proven right or wrong in the near future?

Is Saylor reckless with his bitcoin investment? yes he is and there is nothing wrong if a person chooses to ride and die in any investment. Risk management is good but for how long should we keep being afraid of investments that has potential value in them. Even in an ordinary investment that most people do in real life, it still involves great risks especially the ones that we trust so much and have been making profits from them over the years so why should an investor like Michael Saylor be skeptical about the future of bitcoin?

Whether Saylor is proven right or wrong, it's no one's investment but his and let us not forget that this is a man that once talked down on bitcoin and suddenly he is now one of the highest hodlers so it tells that he is not afraid of any uncertainty.

I agree with you. He's not afraid of what could happen in the future but he's convinced it will all be good. He surely knows what he's doing. Right or wrong it’s his investment.

[Cookdata]

Currently, Bitcoin is trading in the range of $90k. This means that after 5 year of investing in bitcoin and DCA, Strategy's profit reached approximately 20%. They are still making a profit, but do you think it is a good profit? To be honest, for me, this is not a good profit.

Like seriously? You mean 20% worth $10bm isn't good enough? Where exactly can you make an investment and get unrealized $10B profits in 5 years. I want to believe you are capping. Perhaps you want to see Bitcoin as a ponzi scheme, this is actually cool and resposible. How do you present an end of the year report of an investment with $10B and think it doesn't look cool. This isn't even cashout, it's unrealize that means this same $10B can be $20B in the next 5 years.

He is using DCA, and there is nothing wrong with that. But the problem is that instead of investing with his existing capital, he is using leverage to invest in bitcoin. That makes their investment strategy in bitcoin somewhat risky.

There isn't leverage on strategy. If Bitcoin price fall to $1000 to a Bitcoin, it will not liquidate strategy in any way, the only challenge about their investment is there are loans to settle which can be negotiated with another terms and conditions to pay in the future. As long as MSTR positions looks good and the company is making sales, Strategy will be fine, it's possible there is going to be fear, panic, pressure to sell MSTR if the worst happen; there is no way Bitcoin is going down that route, not possible.

[dezoel]

While I agree that the "average purchasing price" is looking high, it's good to remember that he is in profit even right now. And the difference between us and him is that if it goes down even more, he can buy even more. He had purchases at lower levels a lot, even buying at 100k+ didn't make it go up that high, it kept it at below 80k price. So if the price ever drops to lets say 40k or 50k, then he can spam purchase and loans to do that and he will still be in big profit next bull run comes.

[red4slash]

I think it depends on the point of view because it can be a smart move or even a reckless move depending on your point of view and ability.

This could be a smart move because Saylor believes more in bitcoin and has become a maximalist to date with the resources he has and the long-term goals he still holds firm so that when the decline occurs he will not be disturbed because the financial condition he has is still quite good and can still buy more than before.
But on the one hand this will also be a careless step when we force ourselves to become Saylor but do not pay attention to our economy. Saylor's strategy is not easy to replicate and that is an undeniable certainty because we do not have the same finances as Saylor has so in this case I think it would be better to adjust according to the ability to invest rather than force but it leads to destruction and we cannot overcome the risk of bitcoin itself.

[Kasabus]

If there's anyone here who'll be most successful with bitcoin accumulation, that is Michael Saylor. For now, it may be a reckless strategy for some who have still doubts about the future of bitcoin, but for him who is highly optimistic with bitcoin, it won't be surprising if in the future he will lead the whole country's economy and become the wealthiest person in the whole universe.

It takes high risk and high motivation to stay with conviction, and since others cannot stay on it, they believe its more of a pointless way of thinking if the conviction is extra ordinary.

[fillippone]

The real question is:
At what point does a conviction play become reckless? And will Saylor ultimately be proven right or wrong in the near future?

Michael Saylor's rhetoric has changed a lot recently.
I think the biggest shift in his recent storytelling is that he made clear that Strategy can indeed sell (part of) their bitcoin, when certain given conditions arise.
I think this helped a lot with his narrative of Bitcoin as the ultimate reserve asset.

[LogitechMouse]

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Peter Schiff disagrees with Saylor’s view of Bitcoin as “digital gold.” He argues that Bitcoin is extremely volatile and cannot serve as a hedge against inflation.
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His strategy represents a maximum-conviction play. Some see it as visionary, while others view it as reckless.

The real question is:
At what point does a conviction play become reckless? And will Saylor ultimately be proven right or wrong in the near future?

Looking forward to hearing different views.

I don't see it as a Genius nor Reckless.
He's a Maximalist, and he also believes that he can make money if he will go all-in on Bitcoin. Well, that's his belief and there's nothing wrong with it. I'm pretty sure he knows the consequences and risk that he might face if he goes all in, so I'm sure he's ready for it as well. For some, it might be reckless, but I think he knows what he's doing, and if he will be wrong with this one, he has a "Plan B" in order to recover.

Let's not forget that he's a businessmen, and businessmen prioritize profits over everything, so expect that at some point, and some circumstances, he will sell a part of his Bitcoin holdings. I wonder though if that will have a huge effect towards the price of Bitcoin since he's holding around 5% (more or less) of the total Bitcoin supply.

As for Peter Schiff, well what do you expect towards an anti-Bitcoin? I mean he's been like that for as long as I can remember so... he will disagree to all praise that's being said towards Bitcoin. While he's an anti-Bitcoin, he's sometimes saying truth just like what he said where Bitcoin is volatile, and can't be a hedge towards inflation. I mean there's a chance that you might lose more than the rate of inflation in your country especially if crypto enters the bear market.