- MicroStrategy plans to leverage Bitcoin volatility and capital markets to achieve 50% annual returns, with $150 billion in Bitcoin holdings.
- Saylor projects Bitcoin to increase from 0.1% to 7% of global financial capital by 2045, aiming for $13 million per coin.
- MicroStrategy, the largest Bitcoin holder, aims to bridge the USD and Bitcoin markets, promoting Bitcoin as a treasury reserve asset.
MicroStrategy continues its ambitious Bitcoin acquisition strategy, driven by Michael Saylor’s strong belief in the cryptocurrency’s long-term potential. The company has steadily amassed 152,000 BTC and aims to increase its holdings dramatically. Saylor’s plan revolves around borrowing capital to purchase more Bitcoin, rather than lending it out. This strategy could push the value of Bitcoin to an extraordinary $13 million per coin.
Leverage Through Borrowing
Saylor’s approach relies heavily on leveraging volatility. By borrowing money from fixed-income markets and using it to purchase Bitcoin, MicroStrategy seeks to generate a 50% annual return. According to Saylor, this method is more effective than lending out Bitcoin at lower interest rates. His strategy taps into the volatility of Bitcoin through options and convertibles, which could fuel MicroStrategy’s long-term growth.
Long-Term Value of Bitcoin
In Mr Saylor’s opinion, bitcoin is yet to reach its infancy stage. Bitcoins today make up only 0.1% of the global financial assets, although Saylor expects it to reach 7% in 2045. According to his calculations, this ought to happen in the future and foresee the Bitcoin price being at $13 million per coin. To help fund this level of growth, Saylor hopes to source between $100 billion and $200 billion through debt and equity.
Another evidence of the growing influence of MicroStrategy:
The huge BTC balance on MicroStrategy’s balance sheet makes the company one of the most significant BTC players. Saylor has encouraged other firms, particularly organizations within the blockchain industry to emulate the move. The author predicts such enterprises as Coinbase and Marathon Digital Holdings to adopt Bitcoin as the treasury reserve and expand Bitcoin usage in global finance.
MicroStrategy’s approach can have a highly leveraged effect on Bitcoin; its price will rise and Bitcoin will appear in the world economy with an even greater frequency. The objective of the company is to eliminate the gap between USD and Bitcoin and provide financial instruments that can enable the application of cryptocurrencies throughout different sectors.
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