Yea, I actually saw his first post announcing it within a few minutes, I was surprised but not too much He had been saying (hoping) that mstr would ease up on the ATM sales after the last earnings report and use the Convertible Debt markets more, to increase leverage and mnav The interviews with Saylor had been pointing to more usage of the Convertible Debt, specifically when Saylor kept saying mstr will be going for 1% of the $300T global debt markets ($3T) the expansion to $42B/$42B ATM share offering and Convertible Debt during earnings already triggered him, but not too much, he was waiting (hoping) for the Convertible Debt announcement before making any moves The past few weeks, there were again ATM sales and more bitcoin purchase Additional info, mstr has been using the preferred shares as well for ATM to buy more bitcoin, as those are not dilutive to the mstr shareholders but still accretive to mstr bitcoin treasury On this, Josh thinks mstr should be setting up a silo for the bitcoin treasury dedicated to the preferred shares as they are more senior on the claim, this would reflect a higher mnav, Anyway, Jeff has a detailed breakdown on this from a positive spin, the bottom line is that lower mnav for mstr, lower debt ratio, is very good for the long term mstr shareholders Everyone on Crypto Twitter talks about mstr keeps leveraging and leveraging and about to blow up, but the short term call options holders are saying mstr keeps deleveraging deleveraging and selling ATM shares and killing the share price in the short term mstr has no way to please everyone Josh was asked about the next earnings and his prediction that it's almost guaranteed S&P 500 inclusion for mstr, and he said he has to clear his head for now, which suggests to me he may buy back mstr before July or next earnings
The Rise: In August 2020, MicroStrategy, under the leadership of Michael Saylor, made a bold move by investing $250 million in Bitcoin as a treasury reserve asset. This decision marked a transformation from a traditional business intelligence firm to a major player in the cryptocurrency space. As Bitcoin's value surged, so did MSTR's stock, with a remarkable increase of over 400% in 2024 alone. The company's aggressive accumulation of Bitcoin, totaling over 555,000 BTC by 2025, positioned it as the largest corporate holder of the cryptocurrency. This strategy attracted investors seeking indirect exposure to Bitcoin, further boosting MSTR's stock price. The Fall: However, this aggressive Bitcoin-centric approach also exposed MicroStrategy to the volatile nature of the cryptocurrency market. In the first quarter of 2025, the company reported a $5.91 billion unrealized loss on its Bitcoin holdings due to a significant drop in Bitcoin's price. This led to a 6.3% decline in MSTR's stock and raised concerns about the sustainability of its strategy. Critics argue that the company's heavy reliance on Bitcoin makes it vulnerable to market swings and regulatory scrutiny. Opinion: MicroStrategy's journey illustrates the high-risk, high-reward nature of integrating cryptocurrency into corporate strategy. While the initial gains were impressive, the subsequent losses highlight the importance of diversification and risk management. Investors should carefully consider the company's exposure to Bitcoin and the potential implications for its financial health. As the cryptocurrency market continues to evolve, MicroStrategy's performance will likely remain closely tied to Bitcoin's fortunes.
#2 is true, mstr keeps buying bitcoin every week at the cost of selling shares every week, causing the price of mstr to be suppressed or even go down in the short term mstr needs to issue some convertible debt at 0% again, it's always over subscribed, there's a lot of demand
Last week, mstr sold shares $1.3B worth to buy bitcoin, this is not a loan, this is similar to money printing, they bought bitcoin and it's now part of their treasury reserve as permanent capital in the mstr books The mstr share price went up! because bitcoin price went up and mstr owns a lot of bitcoin But if you are holding mstr call options expiring this month or within the next 3 months, and you want price of mstr to go up much higher and faster, you would prefer a leverage way for mstr purchase the bitcoin which is to issue 0% interest Convertible debt, This is why Josh sold, he's been talking about more debt issuance for mstr for 2-3 months PS: on mstr interest on debts annual costs of <$30M and dividends for the Preferred stocks $strk and $strf, one day of mstr ATM share sales can cover 5 years of all those payment obligations
Current news: "BlackRock's iShares Bitcoin Trust (IBIT) has surpassed MicroStrategy's Bitcoin holdings, accumulating nearly 700,000 BTC worth $75.8 billion, representing 3.32% of Bitcoin's total supply. This milestone marks a significant shift in corporate Bitcoin ownership after just 18 months of trading. IBIT now generates $187.2 million in annual fees and commands 55% of the Bitcoin ETF market share. MicroStrategy plans further Bitcoin acquisitions, aiming for $84 billion by 2027 under its expanded capital plan." The difference between the 2 companies: "An ETF holding a commodity and a company that happens to have an asset on its balance sheet are totally different things legally To start with, and most relevant. In the case of a Microstrategy bankruptcy, shareholders are not the highest priority for having value returned to them, creditors such as people who have taken up Microstrategy on their various bond offerings outrank them in a liquidation, which is extremely relevant for both a volatile asset like bitcoin and Saylor's debt centric strategy. There is no similar risk for the ETF. Also the actions Blackrock can perform, for example issuing new shares or just really any other action is far more limited, Saylor has a lot of flexibility with what he decides to do with the company, even before having to get shareholder approval. General gist of being a shareholder (this is not 100% accurate but its not too far off to be a general rule) is that you have the right to remove the management, but while they have the job they can do quite close to whatever they want without asking you. So yeah you don't own the bitcoin directly in either case however you're far closer to it with an ETF than Microstrategy."
Is this real life? "This is like that office episode where Michael is describing his car salesman pyramid scheme and Jim draws the pyramid for him to show him its a scam. Except in this case the company running the pyramid scheme is drawing the freaking pyramid"