Michael Saylor is the executive chairman of MicroStrategy, a software company that has also become one of the biggest corporate holders of bitcoin. In an interview with Julianna Tatelbaum on Yahoo Finance, Saylor discussed why he is bullish on bitcoin and why he believes it is the apex property of the world. Saylor said that the endgame for MicroStrategy is to acquire more bitcoin, whoever gets the most bitcoin wins. He believes that bitcoin is the highest form of property in the world and the best investment asset.
Saylor sees bitcoin as a long-term store of value and digital property rather than a digital currency. He compared owning bitcoin to owning property in New York City. People who own real estate in New York City do not aspire to hold onto the property for a few years, sell it, and move out of the city. Instead, they put it in their will, give it to their children, and pass it down for generations. Saylor believes that bitcoin is the endgame for anyone who wants to own the greatest property in the 21st century.
Saylor made it clear that MicroStrategy’s main goal is to buy and hold bitcoin as it will appreciate in value faster than the S&P index and commercial real estate. He said there is no point in selling the winner to buy the losers, and bitcoin is the winner. MicroStrategy will keep acquiring bitcoin with its cash flows, equity, or capital raises.
One of the key questions Saylor addressed was the high premium MicroStrategy trades at compared to bitcoin, as much as a 90-100% premium according to one analysis he read. Saylor believes it is justified because an institutional investor looking to buy bitcoin has a choice of investing in the ETFs of well-known companies like Black Rock and Fidelity or investing in a company like MicroStrategy. Saylor compared ETFs to ocean-going container ships that can carry huge amounts of capital but do not have performance and leverage compared to companies like MicroStrategy.
Saylor used the analogy of MicroStrategy being like Air Freight, Federal Express that can take investors faster, but their payload is much smaller than super tankers or container ships. However, Saylor believes there is a place for both these strategies, and they complement each other well. The ETFs benefit from companies like MicroStrategy’s existence, and MicroStrategy benefits from the existence of the ETFs.
Saylor also discussed the convertible debt that MicroStrategy has used to invest further in bitcoin. He said that during periods when the price of bitcoin fell sharply, MicroStrategy became more leveraged instead of being 20% levered, it became 40% or 60% levered. The company used convertible debt to raise capital, which is an unsecured instrument not marked to market and does not come due except in four, five, or six years from the point of issuing it. Saylor believes that MicroStrategy does not have to do anything and can wait for the market to recover. MicroStrategy’s shareholders benefited from the deleveraging as bitcoin rallied in the other direction during the crypto winter in 2022 and 2023.
In conclusion, Saylor believes that buying and holding bitcoin is the best use of capital for MicroStrategy. He thinks that bitcoin is the apex property of the world and the best investment asset. Saylor compared owning bitcoin to owning property in New York City, and he believes that it is the endgame for anyone who wants to own the greatest property in the 21st century.
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