MicroStrategy and the Strategic Bitcoin Reserve
The following is a prediction of how President-Elect Donald J. Trump will announce the Strategic Bitcoin Reserve following his swearing in as President of the United States of America in January, 2025. Numbers and dates used are not to be taken seriously, the substance of this prediction is how Microstrategy will be utilized in building the U.S. Governments Strategic Bitcoin Reserve.
On January 20, 2025 Donald J. Trump will announce that he has a contractual agreement on MicroStrategy letterhead, signed by Michael J. Saylor and subject to MicroStrategy board approval to sell 200,000 bitcoin to the U.S. Government within the first year of his presidency, at a set but un-disclosed price.
Note: I believe he shouldn’t announce the purchase price of the bitcoin. He may say something like, “and it will be a good deal”
Why this is beneficial to MicroStrategy and Michael J. Saylor
* Selling bitcoin to the government, if at any kind of premium, will enable MicroStrategy to purchase more bitcoin, earlier than otherwise possible.
* This will begin a relationship between MicroStrategy and the U.S. Government where on an annual basis, consistent with Cynthia Lummis’ Bitcoin Act of 2024, MicroStrategy can sell bitcoin to the U.S. Government in 200,000 bitcoin increments.
* In theory, this deal will increase bitcoin’s price as well as MicroStrategy’s share price.
Note: This is a win-win for MicroStrategy and Michael Saylor
Why this is beneficial to Donald J. Trump
* Donald J. Trump has promised to be pro-bitcoin, communicating legitimate interest and intention to make good on the Strategic Bitcoin Reserve promise is fulfilling a major campaign promise to a new wealthy campaign donor class.
* As explored in Preston Pysh’ BTC215, The Strategic Bitcoin Reserve has an issue, Donald J. Trump has to make good on the Strategic Bitcoin Reserve but he has to lock-in the bitcoin purchase price before the purchase is approved by U.S. Government actors before the price pumps.
* If at time of agreement and purchase, the deal is not beneficial to the U.S. Government, it does not have to agree to the deal and can purchase the bitcoin elsewhere.
Note: This is a win-no loss for the U.S. Government