A $2 trillion asset manager has bought a 12% stake in bitcoin evangelist Michael Saylor’s Microstrategy

MicroStrategy CEO Michael Saylor
MicroStrategy CEO Michael Saylor

Capital International Group, a $2.3 trillion asset manager based in LA, disclosed a 12.2% stake in bitcoin-focused MicroStrategy, according to SEC filings.

The disclosure, of some $560 million in MicroStrategy stock, makes Capital Group the second-biggest shareholder in the business intelligence firm, after BlackRock’s $700 million stake.

MicroStrategy CEO Michael Saylor has become a vaunted figure in bitcoin circles, elevated by his company’s increasingly massive holdings of the cryptocurrency, currently at over 105,000 tokens. The company, which runs a data analytics platform, has spent a combined $2.7 billion buying bitcoin and has borrowed money and issued equity to do so, according to past filings.

MicroStrategy has gone as far as deeming bitcoin its “primary” treasury reserve asset, meaning the cryptocurrency is being used for day-to-day cash management.

Some investors have come to see companies like MicroStrategy as a handy alternative to investing in bitcoin directly, especially given the absence of a bitcoin ETF in America. Funds like VanEck’s Digital Transformation ETF seek to replicate bitcoin’s performance by holding equity in the likes of Square, Coinbase, and MicroStrategy.

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Bitcoin bull Michael Saylor says the cryptocurrency’s volatility will always hurt those who invest purely to trade

Michael Saylor, CEO of MicroStrategy
Michael Saylor, CEO of MicroStrategy

  • Michael Saylor said bitcoin’s volatility will always be disappointing for some investors.
  • In an interview with Sven Henrich, Saylor said anyone who invests purely to trade could run into trouble.
  • The MicroStrategy CEO also said he views his bitcoin holdings as long-term tech and savings investments.
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Bitcoin bull Michael Saylor said the cryptocurrency’s volatility will always hurt those who invest purely to trade or based on speculation in a recent interview with Northman Trader’s Sven Henrich over the weekend.

“The people that invest in bitcoin as traders – and they don’t, they don’t have a technology view or the macro view – they’re always going to be disappointed because of volatility,” Saylor said.

He urged investors not to put more money than they can lose into bitcoin and crypto markets, especially if they were basing trades on speculation and said he is not in a place to give advice to anyone planning to invest or trade with bitcoin over a short timeframe.

“If on the other end you have a 10-year technology conviction and a 10-year macroeconomic conviction, or if you have an ideological conviction, then take money that you can hold for ten years,” Saylor said, adding that the volatility of bitcoin does not impact him personally as he has invested money he can afford to lose and can wait for the cryptocurrency to pick up from bigger sell-offs.

MicroStrategy CEO Saylor is a key figure in the online bitcoin and crypto space, who has consistently said the cryptocurrency is a form of investment. He sees it as a way to store value in place of traditional assets like gold and a way to protect his investments from increasing inflation and taxes.

In recent months, he has made bitcoin part of his company’s financial. Just last month MicroStrategy sold shares worth $1 billion, in parts to purchase more bitcoin, after having already completed a $500 million bond sale to raise cash for more crypto buying.

At the time, the company owned 92,079 bitcoin – currently worth over $3.2 billion based on the most recent price of bitcoin according to Coingecko data.

In comparison to those who buy bitcoin to trade with it or based on speculation, Saylor told Henrich that he is focused on the long-term and views himself as somewhat of a tech investor – not least because of bitcoin’s functionalities including ease of transfer and bitcoin applications.

“I am on the tech long-term tech investment, like the decade-long trend, and on the savings side,” Saylor said.

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Jack Dorsey and Michael Saylor headlined the sold-out Bitcoin 2021 Miami conference. Here are their 12 best quotes from the event.

Saylor,Dorsey
  • Jack Dorsey and Michael Saylor were among the headliners at the star-studded Bitcoin 2021 Miami conference.
  • The pair discussed ESG concerns, how they got into bitcoin, and why they believe it is the digital currency of the future.
  • Insider compiled the best quotes from the Twitter and Microstrategy chief execs.
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Twitter and Square CEO Jack Dorsey and Microstrategy CEO Michael Saylor headlined the sold-out Bitcoin 2021 Miami conference on Friday along with a star-studded lineup that included everyone from Tony Hawk to Floyd Mayweather Jr.

In front of 12,000 attendees, with thousands more watching online, the two discussed why they are so bullish on bitcoin, how they got started in the business, their thoughts on recent ESG concerns, and much more.

Here are Saylor and Dorsey’s 12 best quotes from the interviews, lightly edited and condensed for clarity:

Jack Dorsey

  1. “For me, bitcoin changes absolutely everything. What I’m drawn to most about it is the ethos, what it represents. The conditions that created it are so rare and so special and so precious and I don’t think there’s anything more important in my lifetime to work on. I don’t think there’s anything more enabling for people around the world.”
  2. “Whatever I can do, whatever my companies can do to make it more accessible to everyone is how I want to spend the rest of my life. If I were not at Square or Twitter I’d be working on bitcoin. If it needed more help than Square and Twitter, I would leave them for bitcoin. But I think both companies have a role to play.”
  3. “They’re missing everything. They’re not getting out of New York, they’re not getting out of the country, they’re not talking to people. Go to Nigeria for one day and see the struggle that people have to put up with, with their government and with their money. Go to Ghana that has a bunch of transplants from all over the continent and you witness the same thing every single day. Go to India and you’ll see the same.”
  4. “Everything about it is why we’re into it. There’s nothing else that compares to it. And we have no interests other than making sure we are building a native currency for the internet and helping in every way that we can. So all the other coins to me, don’t factor in at all.”
  5. “You just look at the economics of it and, you know, ultimately miners have to make a profit and getting cheap renewable energy maximizes their potential for profit, it’s really that simple. I thought I had some agreement with some notable figures out there and then that seemed to change in a matter of a few weeks…but I believe fully that bitcoin over time and today does incentivize more renewable energy…and gives people more freedom to convert unused, wasted power into something that actually creates value for billions of people around the world.”
  6. “That realization that we finally have a currency that can be traded at any single point on the planet is pretty incredible and what that enables going forward is pretty mind-blowing and I’m going to do everything in my power to make sure that that happens.”

Michael Saylor

  1. “When I discovered bitcoin I thought this is digital gold on a big tech monetary network and it’s going to grow by a factor of a hundred. Then I thought, well, I should buy as much as I can…I was buying it and I was thinking I have to buy as much as I can, as fast as I can or someone will figure this out and I won’t be able to.”
  2. “Bitcoin is the apex property of the human race. It’s the first time we figured out how to create true property that you can take possession of with full custodial rights that’s least likely to be impaired, that’s most mobile….bitcoin is truly a seminal invention of the human race because for the first time in history we can grant property rights to 8 billion people.”
  3. “I think bitcoin is an extraordinary, disruptive, beneficial technology to the whole energy industry. As I studied it, it became clear that it’s the highest value use of intermittent energy. It’s the highest value use of renewable energy. It’s the highest value use of wasted or stranded energy. And it’s just the highest value use of energy, period. It’s the solution to developing power plants in remote locations, to driving up efficiency of plants and driving down costs…I think as the world understands it, they’re going to embrace it.”
  4. “What I was doing with bitcoin was, I was saying I don’t want to decapitalize the company. I want to keep the capital or grow the capital, but I want to put an asset on the balance sheet. The big breakthrough is I can convert my cash from a liability to an asset and then we realized that if that asset is going to go up by more than 10% a year and you can borrow money at 5% or four, or three, or two, then you should pretty much borrow as much money as you can and flip it into the asset.”
  5. “Bitcoin links together 8 billion people, links together a hundred million companies, it synchronizes the world across political jurisdictions, and it returns rationality to the entire financial system, and it returns freedom and property rights to the entire human race.”
  6. “We say bitcoin is hope. Bitcoin fixes everything…that certainly was the case with our stock….it imbued life into the company…morale was dramatically boosted. We just had the best first quarter we’ve had in a decade.”
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Bitcoin slips below $38,000 as it struggles to retrace losses despite efforts from Musk and Saylor to buoy confidence

GettyImages 1230566081
Bitcoin’s price has tumbled from April’s all-time highs.

  • Bitcoin struggled to hold onto Monday gains, slipping back below the $38,000-level Tuesday.
  • The cryptocurrency fell despite Elon Musk tweeting that he’d had discussions with bitcoin miners on Monday about energy efficiency.
  • Bitcoin was trading at $37,088 as of 9:17 a.m. ET Tuesday.
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Bitcoin struggled to hold ontop gains made on Monday, slipping back below the $38,000-level Tuesday despite tweets Tesla chief Elon Musk about having discussions with bitcoin miners on ways to lessen the cryptocurrency’s environmental impact.

The world’s largest cryptocurrency popped nearly to $40,000 following that tweet Monday but slipped 7% to $37,088 as of 9:17 a.m. ET Tuesday, according to CoinMarketCap.

Bitcoin could find initial support around the $36,000-level, said Pankaj Balani, CEO at Delta Exchange. A break below that, he said, could signal a correction that is bigger than a short-term pull-back.

Following Musk’s announcement, MicroStrategy founder and CEO Michael Saylor also tweeted that he had formed a Bitcoin Mining Council with industry leaders “to promote energy usage transparency & accelerate sustainability initiatives worldwide.”

These leaders include Blockcap, Hut 8, Marathon Digital Holdings, and Riot Blockchain.

Energy used by bitcoin mining operations is under heightened scrutiny, thanks in part to Musk’s abrupt reversal on May 12 when he announced that Tesla is suspending the purchase of vehicles using bitcoin due to environmental concerns.

The price of the cryptocurrency nosedived immediately after, along with a broader cryptocurrency crash that wiped out 47% of the market cap for global digital currencies in just one week.

The Treasury Departments’ decision on May 20 to have any cryptocurrency transfers of at least $10,000 be reported and China’s reiteration on May 21 that it will restrict mining and trading activities accelerated bitcoin’s plunge.

Bitcoin’s excessive energy use and climate change impact have long been criticized, with experts repeatedly warning about the “staggering” amount of energy required to mine the digital currency.

Yet others, such as Cathie Wood’s Ark Invest said these energy consumption concerns are “misguided.” Ark clarified that it believes bitcoin can accelerate a green-energy revolution and become “a net positive for the environment.”

Bitcoin is 42% lower from its all-time high of $64,107 in April.

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‘I’m not selling’: Michael Saylor doubles down on bitcoin as the cryptocurrency falls as low as $30,000

Screenshot 2021 02 17 at 13.55.17
MicroStrategy CEO, Michael Saylor.

  • Bitcoin evangelist Michael Saylor is doubling down on the cryptocurrency despite its recent plunge.
  • Saylor tweeted, “I’m not selling” to his more than 900,000 followers on Wednesday amid bitcoin’s fall.
  • Bitcoin fell as low as $30,000 per coin on the day, while ethereum dropped to under $2,500.
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Noted crypto evangelist Michael Saylor doubled down on bitcoin on Wednesday amid a collapse in the cryptocurrency market.

Bitcoin fell as low as $30,000 per coin on Wednesday and cryptocurrencies as a whole lost nearly 20% of their total market cap in a single day, according to data from CoinMarketCap.com.

Saylor, the co-founder of MicroStrategy, tweeted to his more than 900,000 followers the simple phrase “I’m not selling” amid the drop. The post quickly received more than 30,000 likes.

Saylor has long been a proponent of the crypto space and even held a virtual conference called Bitcoin for Corporations in February to spur institutional investment.

MicroStrategy, an enterprise analytics and software firm, has become one of the largest institutional holders of bitcoin over the past year as well.

The company currently holds some 92,079 bitcoins acquired for roughly $2.251 billion at an average price of approximately 24,450 per bitcoin, according to Saylor.

MicroStrategy’s most recent purchase came a day before bitcoin’s historic drop. The company acquired an additional $10 million worth of bitcoin at an average price of $43,663 per coin, according to a Tweet from Saylor.

MicroStrategy stock fell as much as 15% on Wednesday amid the crypto rout, but mounted a recovery later in the day.

Saylor’s biggest rivals used bitcoin’s fall to take aim at the crypto evangelist. Peter Schiff, a noted gold bull, compared Saylor to Captain Ahab from Herman Melville’s Moby-Dick.

Schiff told his nearly 500,000 Twitter follows that Saylor’s “obsession with Bitcoin will not only be his death but it will kill everyone onboard MSTR.”

“Shareholders must choose between mutiny or jumping ship,” Schiff added.

Read more: ‘Wolf of All Streets’ crypto trader Scott Melker breaks down his strategy for making money using ‘HODLing’ and 100X trade opportunities – and shares 5 under-the-radar tokens he thinks could explode

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Crypto-linked stocks plummet amid massive sell-offs in bitcoin and ethereum

Bitcoin Bubble
  • Bitcoin and ethereum both fell double digits on Wednesday before a recovery in a dark day for the crypto world.
  • Crypto-linked stocks like Coinbase, Riot Blockchain, MicroStrategy, and more all fell in response.
  • The start of the bear market for crypto came after Elon Musk said Tesla would no longer accept bitcoin on May 12.
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Cryptocurrency linked-stocks plummeted on Wednesday amid massive sell-offs in crypto leaders bitcoin and ethereum.

Shares of the cryptocurrency exchange, Coinbase, fell as much as 10%, while shares of cryptocurrency miners like Riot Blockchain and Marathon Digital Holdings were down as much as 17% and 18%, respectively.

Michael Saylor’s Microstrategy, which just “bought the dip” in bitcoin with $10 million at an average price of $43,663 per coin, was down as much as 15% on the day.

Grayscale Bitcoin Trust sank more than 6% on Wednesday as well, and even Tesla saw its stock drop more than 3% on the dark day for cryptocurrency enthusiasts.

Cryptocurrencies as a whole saw roughly 15% wiped off their total market cap on the day, according to data from CoinMarketCap.com, as altcoins fell in tandem with crypto leaders bitcoin and ethereum.

All of the top ten cryptocurrencies by market cap, except the stablecoins, fell double digits on Wednesday.

The cryptocurrency bear market began on May 12, when Elon Musk tweeted that Tesla would no longer accept bitcoin as a payment method due to the environmental impact of its computational mining tactic for minting new coins.

Then on Tuesday, the Chinese government reinforced its previous ban on financial institutions and payments companies operating in the cryptocurrency business.

The National Internet Finance Association of China, the China Banking Association, and the Payment and Clearing Association of China said in a statement that cryptocurrencies “are not supported by real value” and argued speculative trading of cryptocurrencies is “seriously infringing on the safety of people’s property and disrupting the normal economic and financial order.”

The historic single-day fall for cryptocurrencies comes just a day after Galaxy Digital’s Mike Novogratz shrugged off the recent crypto-slump.

“It’s easy to get buried in the volatility of the day,” Novogratz said, according to a transcript on Sentieo, a financial-research site. “Elon Musk’s Twitter comments, bitcoin going down 4,000 points, and everyone starts running around like chickens with their head cut off.”

Novogratz said he expects the total value of crypto assets to triple, or even quadruple, to between $6 trillion and $8 trillion in the coming years.

Read more: ‘Wolf of All Streets’ crypto trader Scott Melker breaks down his strategy for making money using ‘HODLing’ and 100X trade opportunities – and shares 5 under-the-radar tokens he thinks could explode

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Michael Saylor’s MicroStrategy buys another $15 million of bitcoin, just three weeks after its latest purchase

Screenshot 2021 02 17 at 13.55.17
MicroStrategy CEO, Michael Saylor.

  • MicroStrategy bought another $15 million worth of bitcoin Monday, just three weeks after its last purchase.
  • The company now holds around $2.226 billion worth of bitcoin.
  • Saylor in a tweet said his firm owns 91,579 bitcoins acquired for $2.226 billion at an average price of $24,311 per coin.
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Michael Saylor’s MicroStrategy bought another $15 million worth of bitcoin on Monday, three weeks after its latest purchase in March.

The CEO on Twitter revealed that his business intelligence firm purchased an additional 253 bitcoin at an average price of around $59,339 according to a Securities and Exchange Commission filing dated Monday.

“As of 4/5/2021, we #hodl ~91,579 bitcoins acquired for ~$2.226 billion at an average price of ~$24,311 per bitcoin,” Saylor said in the tweet.

MicroStrategy was the first corporation to directly purchase bitcoin, and made its last purchase on March 12.

Saylor has long been an advocate of digital currencies, especially bitcoin, and has been vocal about his stance. The bitcoin evangelist in February this year said 2021 is the “year of institutional investment” in cryptocurrency.

MicroStrategy first made a $250 million bitcoin purchase in August of 2020 and announced that it was using existing cash on its balance sheet to acquire more of the digital currency.

Bitcoin this year been embraced by major institutions including Goldman Sachs, BNY Mellon, Tesla, PayPal, and Visa.

The world’s most popular cryptocurrency is trading lower on Monday by 0.258%, to $58,049 after flirting with the $60,000 last week. The digital asset has a market capitalization of around $1.1 trillion.

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MicroStrategy CEO Michael Saylor says his casual Twitter exchange with Elon Musk in December prompted Tesla to buy bitcoin

Screenshot 2021 03 22 at 08.18.06
  • Michael Saylor said his Twitter exchange with Elon Musk might have influenced Tesla’s bitcoin bet.
  • Saylor, the MicroStrategy CEO, told Time that Tesla’s decision was an inflection point for bitcoin.
  • Saylor said it wasn’t “appropriate business decorum” to discuss conversations with another CEO.
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Elon Musk’s Twitter dialogue with MicroStrategy’s CEO, Michael Saylor, influenced Tesla’s decision to invest $1.5 billion in bitcoin, Saylor said in a recent interview with Time magazine.

Late last year, in response to a tweet from Musk with a lewd meme about bitcoin, Saylor said he should do Tesla’s shareholders a “$100 billion favor” by converting the company’s balance sheet from dollars to bitcoin. “Other firms on the S&P 500 would follow your lead & in time it would grow to become a $1 trillion favor,” he said.

Musk asked whether such large transactions were possible. Saylor replied that they were and that he was willing to share his playbook with the Tesla boss.

Screenshot 2021 03 22 at 08.53.05

A little over a month later, Tesla revealed its biggest bitcoin endorsement to date. It announced that it would invest $1.5 billion in the world’s most popular cryptocurrency and soon accept crypto payments for its products. The automaker used the crypto exchange Coinbase to make its bitcoin purchase, according to The Block.

Saylor called Tesla’s move an “inflection point,” adding that the narrative about belief in bitcoin quickly changed from skepticism to growing acceptance. He said that while it wasn’t “appropriate business decorum” to comment on conversations with a CEO of another public company, their Twitter exchange likely affected Tesla’s decision.

Read more: The CIO of a crypto hedge fund breaks down why bitcoin could rally as high as $400,000 in 2 years – and explains why he’s also bullish on DeFi and NFTs

Saylor pushed back on the idea of bitcoin as an example of irrational investor exuberance, involving enthusiasm about news of price increases.

“If you’re looking for an example of real speculation, it would be people speculating upon whether they can squeeze others in a short squeeze and a small stock, like GameStop,” he said. “Bitcoin is not speculation, OK? Bitcoin is a unique new technology, it’s like the Facebook of money or the Google of money. And it grew from nothing to a trillion dollars in monetary value in 12 years.”

Bitcoin traded flat at $57,380 in early European trading on Monday. It’s up about 95% year-to-date and more than 885% in the past 12 months.

Screenshot 2021 03 22 at 08.52.24
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Michael Saylor’s MicroStrategy says it bought another $15 million worth of bitcoin, bringing its total holdings to more than $5 billion

Screenshot 2021 02 17 at 13.55.17
MicroStrategy CEO, Michaely Saylor.

Michael Saylor’s business intelligence firm MicroStrategy bought another $15 million worth of bitcoin on Friday, bringing the company’s total holdings to 91,326 units.

The firm’s bitcoin holdings were worth roughly $5.26 billion as of March 11’s price per coin. Saylor’s firm acquired its bitcoin for some $2.211 billion at an average price of around $24,214 per bitcoin.

Michael Saylor has long been an advocate of digital currencies, and particularly bitcoin. The CEO even held a conference called “bitcoin for corporations” on February 4 to attract more institutional investment. Saylor said he held the conference by “popular demand” after getting so many questions from fellow CEO’s about his company’s bitcoin purchases.

MicroStrategy first bought into bitcoin with a $250 million purchase back in August of 2020.

Since then, Saylor changed MicroStrategy’s treasury reserve policy in order to make bitcoin the company’s treasury reserve asset and then continued his entry into the digital currency market.

Saylor purchased $50 million of bitcoin on December 4, then quickly followed with a December 8 $400 million bitcoin buy.

When MicroStrategy ran out of funds to buy bitcoin, Saylor turned to debt offerings to feed the habit. On February 17, MicroStrategy’s convertible debt offering hit $900 million and the firm used the proceeds to buy more bitcoin.

Since then, MicroStrategy has used bitcoin sell-offs as buying opportunities, and now the company’s digital asset holdings are nearing 100,000 bitcoin.

MicroStrategy’s business plan and operations have taken a back seat to its bitcoin purchases lately. The company boasts a market cap of roughly $7.71 billion as of March 12, but turned in revenues of just $480 million in 2020 while posting a net loss of roughly $7.5 million, according to SEC filings.

MicroStrategy traded down 4.70%, at $770 per share, as of 9:38 a.m. ET on Friday.

MSTR chart 2
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MicroStrategy CEO Michael Saylor says he’ll consider stock or debt financing in order to buy more bitcoin

A visual representation of the digital Cryptocurrency, Bitcoin is on display in front of the Bitcoin course's graph
A visual representation of the digital Cryptocurrency, Bitcoin is on display in front of the Bitcoin course’s graph

MicroStrategy CEO Michael Saylor said the company is considering issuing more debt in order to buy addtional bitcoin. 

“We’ve been pretty clear that we’ll consider equity and debt financings,” Saylor said, speaking as part of a panel for the Bloomberg Crypto Summit Thursday. “It makes sense to buy as much of that asset class as we can,” he said.

The software technology company was the first corporation to directly purchase bitcoin, driven by Saylor’s view of the digital asset as a hedge against a potential devaluation of the US dollar. 

Saylor on February 24 announced on Twitter that his company purchased an additional 19,452 bitcoins for an estimated $1.026 billion in cash at an average price of $52,765 per bitcoin.

MicroStrategy owns 90,531 bitcoins as of February 24, investing at roughly $2.2 billion in total since it started purchasing the digital asset in August. Thus far, the company has issued two rounds of convertible bonds to purchase more of the coins.

Saylor also pointed to the cryptocurrency’s finite number as one of the factors that make bitcoin valuable. There are only 21 million bitcoins, and 18 million have been mined so far.

“If you want to preserve shareholder value, you have to hold scarce assets,” he said. “Bitcoin is the most liquid, scarce, uncorrelated asset you can buy.”

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