Michael J. Saylor.

Michael Saylor is the executive chairman and co-founder of Microstrategy, a company that used to provide business intelligence, mobile software and cloud based services, but now describes itself as a Bitcoin development company.  He has just proposed that Microstrategy will have another round of convertible senior notes offering, to raise another 500 million USD to buy Bitcoin (my understanding of this is them selling future stock of Microstrategy so they can buy BTC with the money now), this is one week after just raising 800 million USD in the same way, and buying Bitcoin with it.  This next buy will take the company's Bitcoin holdings to over 210,000 BTC meaning they would hold over 1% of the total supply of Bitcoin.

So what's going on?  Why is Saylor going all in on Bitcoin?  Here is my understanding of what Saylor is doing.

The decline of USD.

Every year the purchasing power of your currency decreases, another term for this is Inflation.  There are 2 causes of inflation.  One is governments spending more than they bring in and 'printing' money (they don't actually physically print more money, they issue treasury bonds which banks and companies buy and hold on their balance sheets.  The banks and companies are then paid interest on the bonds when they cash them in) to fill the shortfall.  The other cause is companies increasing the price of goods/services to increase their profits.

The Rise of Bitcoin.

The price rise of Bitcoin doesn't need much explanation.  Although extremely volatile at times, it has risen from zero to the current price of $72,000.

Saylor's Hedge against USD.

The first to see something happening and act against the 'norm' is often laughed at and ridiculed.  I believe Saylor was one of the first CEO's to see the decline of the USD and act on it.  He basically gambled on holding BTC on the company's balance sheet rather than USD as a hedge against the declining USD.  In 2021 when Bitcoin hit $15k, Saylor was largely ridiculed and was told his gamble had failed with his company down almost $2 Billion in it's investment strategy.  Fast forward to today however, with the BTC price at an all time high, Microstrategy is sitting on an unrealised profit of around $6 Billion!

What does all this mean for you?

Some people believe that companies holding so much of the supply isn't a good thing.  They can basically crash the price down if they dump it all on the market.  My personal opinion is that while Saylor is still chairman, you won't have anything to worry about.  What you could do as an individual though, is take a leaf out of his book, and use Bitcoin as a long term savings account.  Why keep your savings in fiat when it's purchasing power is decreasing year on year?

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