In an interview, Michael Saylor, the well-known CEO of MicroStrategy, defines his company's strategy and reveals the profits it makes from Bitcoin: "We make $500 million a day."
Michael Saylor, co-founder and CEO of microstrategy, has revealed that his company is generating a staggering $500 million in profits a day from its Bitcoin investments. This claim, made during an interview with CNBC, reflects the bold and risky strategy that MicroStrategy has adopted since Saylor decided to bet on the world's most famous cryptocurrency.
MicroStrategy, a business intelligence company, has converted much of its treasury into Bitcoin, becoming one of the largest institutional holders of the cryptocurrency. Over the past two weeks, MicroStrategy's Bitcoin investments have seen a valuation of $5.4 billion, leading Saylor to claim that "We're selling dollar bills for $3, sometimes a million times a minute."
This strategy has resulted in an impressive gain for the company. Over the past month, MicroStrategy (MSTR) stock has risen 97%, while the price of Bitcoin has increased by 47%. Over the year, the company's stock has gained more than 515%, compared to a 122% increase in the price of Bitcoin. These results have led Saylor to claim that MicroStrategy "It may be the most profitable and fastest growing company in the United States right now."
MicroStrategy's strategy
MicroStrategy’s Bitcoin strategy is not just a financial bet, but a long-term vision for the future of the global economy. Saylor believes Bitcoin has the potential to become a global store of value, similar to gold, but with unique characteristics that make it more accessible and secure.
To understand the logic behind this strategy, it is important to understand the concept of a “store of value.” Historically, gold has been the primary asset used to preserve value over the long term, protecting investors against inflation and the volatility of fiat currencies. However, Bitcoin offers a digital alternative with features such as scarcity (only 21 million Bitcoins will ever exist), indivisibility (it can be divided into very small fractions), portability (it can be instantly transferred anywhere in the world), and security (thanks to its blockchain technology).
Saylor argues that these features make Bitcoin a superior store of value to gold. Furthermore, Bitcoin adoption by institutions and governments has been on the rise, which has contributed to its valuation. Companies such as Tesla, Square, and PayPal have invested in Bitcoin, and some countries, such as El Salvador, have adopted the cryptocurrency as legal tender.
Impact on the stock market
And all of this MicroStrategy strategy has had a significant impact on the stock market. The company’s valuation has far outpaced that of other leading tech companies. For example, Nvidia, the world’s most valuable artificial intelligence company, has seen its stock rise by 195% this year, but this is just a fraction of MicroStrategy’s gain.
The disparity in MicroStrategy's valuation is largely due to its aggressive Bitcoin acquisition strategy. According to a BitMEX analysis, MicroStrategy is trading at 256% of the net valuation of its Bitcoin holdings. This suggests that investors are willing to pay a significant premium to gain exposure to Bitcoin through MicroStrategy, especially in a context where financial regulations limit the purchase of Bitcoin ETFs.
Predictions and reviews
Saylor has not been short on his predictions about the future of Bitcoin. In a bold statement, he claimed that the price of Bitcoin could reach $13 million by 2045. If this prediction comes true, Bitcoin’s market cap would surpass $250 trillion, eclipsing the current world GDP and global stock markets.
This prediction has sparked a debate about the economic implications of such a highly valued Bitcoin. Some analysts argue that a Bitcoin at $13 million could lead to massive hyperinflation, as the value of fiat currencies would plummet in comparison. However, Saylor believes that Bitcoin will act as an anchor of value, protecting investors against inflation and volatility.
Not everyone shares Saylor’s optimistic view. Warren Buffett, one of the world’s most respected investors, has publicly criticized Bitcoin, describing it as a “speculative instrument” with no intrinsic value. Buffett has held $325 billion in cash at Berkshire Hathaway, arguing that liquidity is crucial in times of economic uncertainty. Saylor, for his part, sees not investing in Bitcoin as a missed opportunity, especially in a context of inflation and economic volatility.
Maintaining acquisitions
Meanwhile, MicroStrategy continues to steadily acquire Bitcoin. Over the past few weeks, the company has purchased 55.500 Bitcoin for approximately $5,4 billion, at an average price of $97.862 per Bitcoin. This acquisition follows the purchase of 51.780 Bitcoin for $4,6 billion and $2 billion worth of Bitcoin in the previous weeks.
MicroStrategy's strategy includes not only acquiring Bitcoin, but also issuing debt and equity to fund these purchases. The company has completed a $3 billion debt offering and sold 5.597.849 shares for $2,46 billion. MicroStrategy intends to raise a total of $42 billion over the next three years, with the goal of continuing to acquire Bitcoin.
Bernstein analysts anticipate that MicroStrategy could acquire 4% of the circulating supply of Bitcoin over the next decade. If this prediction is fulfilled, MicroStrategy could own 830.000 Bitcoin, worth $830 billion if the price of Bitcoin reaches $XNUMX million per unit.
Regardless, MicroStrategy’s bet on Bitcoin has resulted in impressive gains and has made the company a key player in the cryptocurrency ecosystem. Michael Saylor has demonstrated bold vision and unwavering confidence in Bitcoin, leading the company to make decisions that have challenged traditional market norms. As the debate over the future of Bitcoin continues, MicroStrategy’s strategy remains an example of how businesses can adapt and thrive in an increasingly digital and decentralized world.
