Nostr Web Client

nostr:nprofile1qqsvf646uxlreajhhsv9tms9u6w7nuzeedaqty38z69cpwyhv89ufcqpzfmhxue69uhhqatjwpkx2urpvuhx2ucpzamhxue69uhhyetvv9ujucm4wfex2mn59en8j6gvqam0u Jack, on the last Mailbag Monday you mentioned not understanding why someone using Strike would want BTC interest vs being all in BTC. Here’s a quick example:

- work in finance. Industry standard is low salary and like 75% of total comp comes in a bonus once a year

- big family, big fixed costs and combined with low salary, the result is a monthly “burn rate”

- so I need to hold 8-12 months of budgeted expenses in something relatively stable to cover known expenses in the year.

- could do this in bitcoin, but everything outside of those 8-12 months of expenses is already in Bitcoin or otherwise invested. So this is on the margins.

Maybe you’d say put every dollar in Bitcoin, but with the big family it’s certainly peace of mind having that amount to cover < 12 mo. expenses in cash without the downside potential. Would be even better to earn some Bitcoin interest on that.

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Discussion

jack mallers 6mo ago

sure, but then why get a lower return? why not put the cash in a money market fund or Robinhood and get 4.5%-5%? why do you want 3% converted to BTC? can’t you get 5% and just buy BTC yourself?

Phil 6mo ago

I used to do this until River offered the 3.8%. That’s about the same as the 4.25% MM rate on an after-tax basis. Not sure if the 3.8% is supposed to be taxable as well, but it didn’t show up on my River tax docs. So the net-tax rates are closer than you’d think, and it’s just one less transfer I have to make every month out of my brokerage and into Strike or River to buy bitcoin. From a qualitative perspective, I like it because it feels like I’m supercharging my normal DCA.

jack mallers 6mo ago

sure. for me it seems dubious for it to a priority for Strike, but the people have spoken! i know it’s on our roadmap. probably Q3, definitely before the year is over

Phil 6mo ago

You’re a man of the people. I’ve had the same thought many times, that’d it would likely be better to just be 100% in bitcoin. Maybe the truth is I just really hate the idea of selling bitcoin to pay expenses, I like seeing the bitcoin count only go up.

I know that’s antithetical to treating bitcoin like a real currency, but trying to overcome that feeling. Bought Steak & Shake with BTC this past week, so progress.

DRE 6mo ago

Have you considered STRF or STRK? Might meet your needs much better than anything else in the market

Phil 6mo ago

Until MSTR holds its bitcoin somewhere other than with Coinbase as a custodian, I don’t want to introduce more risk than just holding self-custody Bitcoin or cash.

DRE 6mo ago

They also use Fidelity, so there you go 👍🏼

But even if they lose all their bitcoin (extremely unlikely), the portion of the company that’s not attached to their bitcoin holdings is enough to cover their Convertible bond and STRF obligations.

Phil 6mo ago

I trust Fidelity a lot more than Coinbase, didn’t realize MSTR had diversified. That’s very positive news. Thanks for this

DRE 6mo ago 💬 1

👍🏼

https://youtu.be/Uf7NCvPtDJc?feature=shared

DRE 6mo ago

9.5% effective yield ($10/share)

It has good upside too even though it’s supposed to behave like a treasury bond

Senior on the capital stack.

Much better than any savings account or money market fund.

Thomas Evans 6mo ago

Makes more sense, I think people are drawn to its novelty and are disregarding this