Nasdaq-listed company Microstrategy recently bought nearly 17,000 bitcoins in 74 hours, at a cost of around $ 175 million. The CEO of this billion dollar company was skeptical of bitcoin, but recently became a bitcoin bull when his company bought $ 425 million worth of bitcoin.
Billion dollar state-owned company dives into Bitcoin
Microstrategy recently made history in bitcoin when it became the first publicly traded company to spend a significant amount of its reserves to buy bitcoin.
The company bought a total of 38,250 BTC at an aggregate price of $ 425 million. The first purchase was announced on August 11 for 21,454 bitcoins at an aggregate price of $ 250 million. The company then revealed on September 14 that it had purchased an additional 16,796 bitcoin at a total price of $ 175 million.
Microstrategy CEO Michael Saylor explained on Friday:
To acquire 16,796 BTC (disclosed 9/14/20), we continuously traded 74 hours, executing 88,617 trades ~ 0.19 BTC every 3 seconds. ~ $ 39,414 in BTC per minute, but at any point we were ready to buy $ 30-50 million in seconds if we were lucky with a 1-2% peak down.
However, Saylor was previously a bitcoin skeptic. He tweeted on December 18, 2013: “The days of Bitcoin are numbered. It’s only a matter of time before it suffers the same fate as online gambling. ”
In a podcast interview with Morgan Creek Digital partner Anthony Pompliano posted Wednesday, Saylor admitted he forgot the tweet. “I’m really ashamed to say I didn’t know I tweeted it until one day I tweeted that I bought $ 250 million worth of bitcoin, then I discovered Twitter consciousness beehive mind crypto where all of a sudden they all went through my whole tweets and they found it, ”he described. “They reminded me of it. They compared it and I’m like oh my god I literally forgot I said that before. Nonetheless, Saylor added, “I didn’t get upset about it. I’m like you were right I was wrong, what an idiot I was, I wish I could go back and start over.
Bitcoin solves the cash flow problem, better than gold
The CEO of Microstrategy then detailed how his company dove into bitcoin. With a cash-generating business and $ 500 million in cash, he was faced with the challenge of knowing what to invest in to preserve his value.
“Number one, I have a mega, mega, mega problem and the mega problem is I have a lot of money and I’m watching it melt,” the CEO said. He revealed that before investing in bitcoin, he watched many videos, including those of Andreas Antonopoulos, Pompliano and Dan Held. He also read The Bitcoin Standard essays by Saifedean Ammous and Parker Lewis – to name a few. To convince his company’s board of directors to buy bitcoin, he gave them homework to read and watch bitcoin videos, before having intense discussions with each of them.
Saylor is adamant that bitcoin is a better investment than gold. “Bitcoin is an anti-fragile and scalable thing,” he said in an interview with macro strategist Raoul Pal, who shares his feeling that bitcoin is better than gold. “It is the strongest currency because it is becoming more and more exponential … but it is also smarter, stronger and faster than gold.” He noted:
When I say it’s harder than gold, I mean it’s not just 10 times harder because it goes 100 years without losing any of its value. I say it’s harder because it’s an organic nest of cybernetic hornets feeding on encrypted energy.
“It’s a living thing, which means the miners will continue to improve their equipment. The developers will continue to improve their development. The knots will change. Every part of the ecosystem will change. And, they change in this terrifying Darwinian, capitalist, libertarian, aggressive, win-win, do not hold any bar, no company, no country, no company does, ”explained the CEO of the company listed on the Nasdaq.
He believes that anything controlled by anyone, entity or country is “crippled”, claiming that “anything controlled by a CEO is crippled, controlled by a state is paralyzed, controlled by a country is paralyzed.” On the other hand, he said: this whole thing [bitcoin] is its own ecosystem. Gold will not get a million times smarter over the next 10 years. It’s not thinking at all, it’s a piece of metal lying there. He noted that bitcoin could be 1,000 times better than gold.
CEO doesn’t care about Bitcoin’s volatility
Saylor further stated that he is not worried about bitcoin’s volatility. “I keep it for a hundred scary years… I’m not the day trader who worries about this, so I think as institutions come in and buy larger amounts, they dampen volatility. He also pointed out that his company was able to acquire a large amount of bitcoin without significantly affecting its price.
In addition, he pointed out that the alternatives are much less attractive. “Let’s be honest, there is a real negative return on anything I can buy. Okay, gold has a negative real return of three, four, five percent in my opinion, ”he said, noting that bonds also have negative real returns. The CEO expressed the opinion:
All other non-volatile assets have a negative real return meaning everything else is vital flowing through my veins so if my choice was to accept some volatility and live on or I had no cash volatiles that were buying 30% less in a matter of eight weeks… at this rate you’re not going through the decade and so volatility is just something you have to live with.
He added, “I find the entire Bitcoin community to be an inspiration and I noted in our press release that one of the main drivers of our belief in its success is the community ethos. It’s a pretty amazing group of people and all the thoughts and initiatives that I find extraordinary.
What do you think of Microstrategy and its CEO? Let us know in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons
Warning: This article is for informational purposes only. This is not a direct offer or the solicitation of an offer to buy or sell, nor a recommendation or endorsement of any product, service or business. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or allegedly caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.