where is the risk for #mstr ? nostr:npub15dqlghlewk84wz3pkqqvzl2w2w36f97g89ljds8x6c094nlu02vqjllm5m ,,there is no such thing as a free lunch,, nostr:npub1rtlqca8r6auyaw5n5h3l5422dm4sry5dzfee4696fqe8s6qgudks7djtfs
Discussion
What happens if we dump 80%? Does mstr fail? nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy says the dumps are over though #supercycle
The big risk is that the premium doesn’t sustain and you end up with less bitcoin.
The premium comes from their ability to create bitcoin exposure with downside protection for institutions that can’t own bitcoin or the ETF, and also their ability to grow their massive bitcoin holdings by continuing to run a speculative attack on the dollar.
Worth pointing out since a lot of people think the premium is based on mania and hot air.
How does this compare/differ to the GBTC premium we saw last cycle? Obviously some differences between form and function but could an unwind behave similarly?
They are not similar at all imo
$GBTC is a closed end fund (NOT included in market cap weighted index funds)
$MSTR is not a closed end fund (IS included in index funds such as VTI, VXF, VB, VO, VUG,VBK, IWR, and eventually QQQ and SPY)
Passive buy side volume eating $MSTR at ANY price
That’s fair. I need to review what occurred to GBTC and see if there are any meaningful parallels. My left-curve brain just hears “premium to NAV” and has flashbacks to 2021.
What could be a trigger for the premium to collapse? Do you have any reading recommendations for the topic ? Would like to understand it better but cant seem to get a firm grip on the topic.