Title: Saylor's Bitcoin Binge: Is MicroStrategy Officially a Crypto Cult?
So, MicroStrategy's at it again. Another round of financial gymnastics to buy more Bitcoin. This time, they're offering 3.5 million shares of some Euro-denominated perpetual preferred stock – STRE, if you wanna get technical – just to keep the BTC train rolling. Strategy proposes euro STRE share offering to fund future bitcoin buys - theblock.co A 10% annual dividend, payable in cold, hard cash? Sounds legit... until you dig into the compounding interest on unpaid dividends. It starts at 11% and ratchets up to a freaking 18%. Seriously?
It's like taking out a payday loan to gamble on meme stocks. Only, instead of a payday loan, it's a publicly traded company.
The Numbers Don't Lie (Or Do They?)
Let's break this down. They snagged 397 more Bitcoin for $45.6 million, averaging $114,771 per coin. That's… ambitious, considering Bitcoin's currently hovering around $106,865. And their stock? Down almost 25% in the last month. This ain't your grandpa's value investing, folks. This is... something else.
They’re sitting on 641,205 BTC now. That's a lot of digital gold, sure. But at what cost?
Mizuho, TD Cowen, and Benchmark are all singing praises about the "sustainability" of this model. Sustainable for who? For Saylor, maybe. For the shareholders holding the bag when the Bitcoin bubble bursts? I ain't so sure.
The Cult of Saylor
Here's the thing: MicroStrategy isn't a software company anymore. It's a Bitcoin holding company with a side hustle in business intelligence. They pioneered this "digital asset treasury" (DAT) model, which, let's be real, is just a fancy way of saying "we're betting the entire company on crypto."
They started this madness back in August 2020, remember? $250 million of their own cash. Seemed crazy then, seems even crazier now. They’ve been funding this habit with at-the-market sales of stock, preferred stock… you name it, they're selling it. It slowed down a bit in Q3, but analysts think it's just a "cyclical" thing. Right. Like the dot-com bubble was just a "cyclical" downturn.
I mean, are we really supposed to believe that this is sound financial strategy? Or is it just one guy's obsession driving the whole ship into an iceberg?
Walking down Wall Street, you can almost hear the hushed whispers: "Is Saylor the next Buffett, or just another Icarus flying too close to the sun?"
So, What's the Endgame?
What happens when Bitcoin crashes? What happens when the dividends on that STRE stock come due and they can't pay? What's the exit strategy here? Or is there even one?
I'm not saying Bitcoin is worthless. But tying the fate of a publicly traded company to its volatile swings seems like a recipe for disaster. Maybe I'm just old-fashioned, but I prefer my companies to, you know, actually make something.
This Is a Five-Alarm Fire
MicroStrategy's Bitcoin strategy is insane. It's a gamble of epic proportions, fueled by debt and unwavering belief. And honestly, it's terrifying to watch.
Tags: bitcoin