MicroStrategy CEO and outspoken Bitcoin believer Michael Saylor recently gave an interview with Bloomberg & CNBC regarding his positions and rumours of a MicroStrategy Bitcoin margin call. Despite Bitcoin currently being down over 50% from all-time highs ($69,000), Saylor still seems positive on his Bitcoin bet. The investor even went as far as stating he “Can’t come up with a better idea” regarding MicroStrategy’s Bitcoin investments.
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MicroStrategy & Bitcoin
Since MicroStrategy began investing in Bitcoin in 2020, BTC is up by 86%, gold is down 10%, and the NASDAQ is flat.
So far MicroStrategy has spent over $4 billion on accruing 129,219 BTC for an average price of $30,700. Although there have been fears of a MicroStrategy Bitcoin margin call, Saylor seems to think they’re unwarranted stating “We’ve only got a $200 million loan that we have to collateralize, and we’re 10x over-collateralized on that right now. If the market traded down by a factor of 10, we got cash and we generate cash flow, so the margin call is much ado about nothing”.
My @BloombergTV discussion with @emilychangtv includes a post-mortem on @MicroStrategy’s #Bitcoin Strategy and a review of the top ten hurdles that the industry must overcome as it crosses the chasm and achieves mainstream adoption. pic.twitter.com/Ujid4m1pxe
— Michael Saylor⚡️ (@saylor) June 17, 2022
However, with MicroStrategy’s current valuation of $1.9 billion sitting well below its Bitcoin holdings, worth around $2.7 billion, investors don’t seem quite as hopeful as Saylor.
There are a lot of factors that contribute to the viability of an investment. Time is a big one. When speaking about Bitcoin’s long-term performance, Saylor said “If your time horizon is 1 month, it looks like a volatile risk asset but if your timeline is 10 years, it looks like a risk-off store of value asset”. At the end of the day, every financial market works in cycles. There will always be ups and downs, both are needed for a healthy market cycle.
It seems MicroStrategy and Saylor are both in Bitcoin for the long haul with the prominent CEO stating that “Nobody’s ever lost money investing in Bitcoin for four years”. When asked if he thought the current market offered a “Great buying opportunity”, Saylor simply said “Absolutely”.
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