The theory of a speculative attack on fiat currencies was born around 2014 (Marty Bent had a show on this topic yesterday but I haven’t watched it yet so consider listening to it). Bitcoin at the time had a very small cap and it was unreasonable to expect a corporation or government to buy and hodl as a reserve asset on their balance sheet. Individuals who have realized what bitcoin actually is were also few. Fast forward 10 years and we have initial steps in the realization of this theory. Companies like MicroStrategy, Tether, Block, MetaPlanet use various means such as retained earnings or issuing stock and bonds in order to purchase bitcoin. The government of El Salvador has even launched a website where we can track how many bitcoin they own. All of these to me are the initial steps on the road to hyperbitcoinization. But we could all be wrong...
My bet is certainly far smaller than that of the American entrepreneur and one of the founders of MicroStrategy - a business intelligence company - namely Michael Saylor. This move of his to be able to figure out what bitcoin is and at the same time sell the idea to the other c-suite and shareholders at MSTR could turn out to be one of the most significant actions of this century. That's because at the moment, with the exception of exchange-traded funds buying bitcoin, no other company owns 1% or more of the limited 21 million supply. And it cost them under $10 billion. There are quite a few companies that have larger cash holdings, one of which is Dell Technologies. I mention it for a reason, because its owner Michael Dell made waves on Twitter with 2 bitcoin posts. Their problem is that it takes time to accumulate 210,000 bitcoin, and if the price remains stable around $60,000 it would cost them almost $13 billion. But the price of something with limited supply and relatively stable or even rising demand can almost never be stable.
But let's go back to the other Michael. Because it is a publicly traded company, we have all the data we need for some simple calculations. Their first recorded purchase was in August 2020, when they paid $250 million for 21,454 bitcoin (an average price of almost $12,000). The surveilance sickness and lockdowns in 2020 caused Saylor to think about how to transform what he says a dying company referring to MSTR, and after an extensive search he comes across bitcoin. The source of funds for their initial purchase were retained earnings. So his goal was to transform the US dollar sitting as retained earnings on the company's balance sheet and depreciating slowly as time goes by into bitcoin. Over time, the conviction of everyone involved in this operation became greater and greater, and they decided to use other means - issuing convertible bonds and common stock. MicroStrategy transformed from a business intelligence software company into a bitcoin fund. Investors wanting exposure to bitcoin are happy to finance the company at super low interest rates of under 1%. Let's take a look at was this worth it? The most important thing for a company right after being profitable is to properly allocate capital. In the case of MicroStrategy, their strategy is quite simple – raise funds and purchase bitcoin.
In the following Excel spreadsheet, we can analyze how successful they have been in their strategy to maximize the amount of bitcoin per share. If the bitcoin that 1 share buys steadily decreases, it means diluting the current shareholders, 1 share buys them less and less of the thing they want. This metric is also essential for a company operating in the fiat world where the end goal are things such as buildings, machinery, intellectual capital, cash. Some brief clarification on the columns - date, bitcoin hodl and number of shares need no explanation. Number of convertibles means all options/bonds that can be converted to shares in the future under certain conditions, i.e. they are not shares at the moment, but we have to take them into account in the calcs because they can dilute current shareholders and their shares in the company. That's what the next column is, it just adds up the previous two. The last 4 columns are the result of our analysis, namely how many bitcoin (or in this case satoshis) we own if we have 1 share of the company. The ideal scenario is that the number of sats increases over time. The same applies to the number of sats per convertible plus share. We can see that over a period of nearly 4 years this has been the case - with 1 share at the end of 2020 we could have held 735,058 sats, and by March 2024 this had increased to 1,214,246 (65% growth).
The number of shares or number of convertible instruments + shares to 1 bitcoin is also an interesting metric. As expected it is in a positive trend for the company's shareholders – as at 31 December 2020, 136 shares were needed to own 1 bitcoin, and by March 2024 they had dropped to 82.
The takeaway from this data, at least in my opinion, is that the strategy of using leverage in the form of bonds or shares in order to purchase bitcoin has been quite successful so far for MSTR. In almost 4 years they have managed to reach 1% of the total supply for just a 75% increase in stock and convertibles.
cc
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cc
nostr:npub1cn4t4cd78nm900qc2hhqte5aa8c9njm6qkfzw95tszufwcwtcnsq7g3vle nostr:npub1ex7mdykw786qxvmtuls208uyxmn0hse95rfwsarvfde5yg6wy7jq6qvyt9 nostr:npub1hu3hdctm5nkzd8gslnyedfr5ddz3z547jqcl5j88g4fame2jd08qh6h8nhnostr:npub1qy2tkywa36ufh76qv62snv4953eayufxufav4evz2le06lxe2amqpxavna nostr:npub13vepw9xdhjzhp87lv5h7z2jgzteltmzqe4scjsn9dtwwncz6ekms5p489d
The theory of a speculative attack on fiat currencies was born around 2014 (Marty Bent had a show on this topic yesterday but I haven’t watched it yet so consider listening to it). Bitcoin at the time had a very small cap and it was unreasonable to expect a corporation or government to buy and hodl as a reserve asset on their balance sheet. Individuals who have realized what bitcoin actually is were also few. Fast forward 10 years and we have initial steps in the realization of this theory. Companies like MicroStrategy, Tether, Block, MetaPlanet use various means such as retained earnings or issuing stock and bonds in order to purchase bitcoin. The government of El Salvador has even launched a website where we can track how many bitcoin they own. All of these to me are the initial steps on the road to hyperbitcoinization. But we could all be wrong...
My bet is certainly far smaller than that of the American entrepreneur and one of the founders of MicroStrategy - a business intelligence company - namely Michael Saylor. This move of his to be able to figure out what bitcoin is and at the same time sell the idea to the other c-suite and shareholders at MSTR could turn out to be one of the most significant actions of this century. That's because at the moment, with the exception of exchange-traded funds buying bitcoin, no other company owns 1% or more of the limited 21 million supply. And it cost them under $10 billion. There are quite a few companies that have larger cash holdings, one of which is Dell Technologies. I mention it for a reason, because its owner Michael Dell made waves on Twitter with 2 bitcoin posts. Their problem is that it takes time to accumulate 210,000 bitcoin, and if the price remains stable around $60,000 it would cost them almost $13 billion. But the price of something with limited supply and relatively stable or even rising demand can almost never be stable.
But let's go back to the other Michael. Because it is a publicly traded company, we have all the data we need for some simple calculations. Their first recorded purchase was in August 2020, when they paid $250 million for 21,454 bitcoin (an average price of almost $12,000). The surveilance sickness and lockdowns in 2020 caused Saylor to think about how to transform what he says a dying company referring to MSTR, and after an extensive search he comes across bitcoin. The source of funds for their initial purchase were retained earnings. So his goal was to transform the US dollar sitting as retained earnings on the company's balance sheet and depreciating slowly as time goes by into bitcoin. Over time, the conviction of everyone involved in this operation became greater and greater, and they decided to use other means - issuing convertible bonds and common stock. MicroStrategy transformed from a business intelligence software company into a bitcoin fund. Investors wanting exposure to bitcoin are happy to finance the company at super low interest rates of under 1%. Let's take a look at was this worth it? The most important thing for a company right after being profitable is to properly allocate capital. In the case of MicroStrategy, their strategy is quite simple – raise funds and purchase bitcoin.
In the following Excel spreadsheet, we can analyze how successful they have been in their strategy to maximize the amount of bitcoin per share. If the bitcoin that 1 share buys steadily decreases, it means diluting the current shareholders, 1 share buys them less and less of the thing they want. This metric is also essential for a company operating in the fiat world where the end goal are things such as buildings, machinery, intellectual capital, cash. Some brief clarification on the columns - date, bitcoin hodl and number of shares need no explanation. Number of convertibles means all options/bonds that can be converted to shares in the future under certain conditions, i.e. they are not shares at the moment, but we have to take them into account in the calcs because they can dilute current shareholders and their shares in the company. That's what the next column is, it just adds up the previous two. The last 4 columns are the result of our analysis, namely how many bitcoin (or in this case satoshis) we own if we have 1 share of the company. The ideal scenario is that the number of sats increases over time. The same applies to the number of sats per convertible plus share. We can see that over a period of nearly 4 years this has been the case - with 1 share at the end of 2020 we could have held 735,058 sats, and by March 2024 this had increased to 1,214,246 (65% growth).
The number of shares or number of convertible instruments + shares to 1 bitcoin is also an interesting metric. As expected it is in a positive trend for the company's shareholders – as at 31 December 2020, 136 shares were needed to own 1 bitcoin, and by March 2024 they had dropped to 82.
The takeaway from this data, at least in my opinion, is that the strategy of using leverage in the form of bonds or shares in order to purchase bitcoin has been quite successful so far for MSTR. In almost 4 years they have managed to reach 1% of the total supply for just a 75% increase in stock and convertibles.
cc
nostr:npub15dqlghlewk84wz3pkqqvzl2w2w36f97g89ljds8x6c094nlu02vqjllm5m nostr:npub1guh5grefa7vkay4ps6udxg8lrqxg2kgr3qh9n4gduxut64nfxq0q9y6hjy nostr:npub1cj8znuztfqkvq89pl8hceph0svvvqk0qay6nydgk9uyq7fhpfsgsqwrz4u nostr:npub1t8a7uumfmam38kal4xaakzyjccht4y5jxfs4cmlj0p768pxtwu8skh56yu nostr:npub1a2cww4kn9wqte4ry70vyfwqyqvpswksna27rtxd8vty6c74era8sdcw83a nostr:npub1sg6plzptd64u62a878hep2kev88swjh3tw00gjsfl8f237lmu63q0uf63m nostr:npub19jfsjxx7gtw2t52qepx93ek57fdstfwszct3qqwzns4zxmvsc5gswf8rx0 nostr:npub1hxwmegqcfgevu4vsfjex0v3wgdyz8jtlgx8ndkh46t0lphtmtsnsuf40pf nostr:npub1s5yq6wadwrxde4lhfs56gn64hwzuhnfa6r9mj476r5s4hkunzgzqrs6q7z nostr:npub14mcddvsjsflnhgw7vxykz0ndfqj0rq04v7cjq5nnc95ftld0pv3shcfrlx nostr:npub1r8l06leee9kjlam0slmky7h8j9zme9ca32erypgqtyu6t2gnhshs3jx5dk nostr:npub15vzuezfxscdamew8rwakl5u5hdxw5mh47huxgq4jf879e6cvugsqjck4um
the idea is to select people you know and trust as guardians of the federation, so called 2nd party custody model. The mint could issue unbacked by bitcoin tokens but that can be done if 2/3 of the guardians are ok with it
this RHR will be the most anticipated in a long time
what did i miss? what dan
hahahahahah saylor shaming is a thing now
I bet if this is true then this must be fidelity. they are their own custodian, have seemingly pro bitcoin people before it was cool and am surprised they have not tried beating blackrock for #1 with supporting devs narrative
yes i think fidelity as well
"I bet if this is true then this must be fidelity. they are their own custodian, have seemingly pro bitcoin people before it was cool and am surprised they have not tried beating blackrock for #1 with supporting devs narrative"
I bet if this is true then this must be fidelity. they are their own custodian, have seemingly pro bitcoin people before it was cool and am surprised they have not tried beating blackrock for #1 with supporting devs narrative
GOOD MORNING.
DISPATCH IN FOUR HOURS AT 1700 UTC WITH TONY - nostr:npub1t0nyg64g5vwprva52wlcmt7fkdr07v5dr7s35raq9g0xgc0k4xcsedjgqv - AND BEN - nostr:npub1u8lnhlw5usp3t9vmpz60ejpyt649z33hu82wc2hpv6m5xdqmuxhs46turz - TO DISCUSS MUTINY WALLET, LIGHTNING, FEDIMINT, AND NOSTR.
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lessgo bois
nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx morning Matt
stay humble stack sats
