MicroStrategy: So, what’s the strategy?

Michael Saylor: Exactly… 

Michael Saylor has officially gone full Bitcoin maximalist, and there’s no turning back now. MicroStrategy—the software company that dropped the “software” part years ago—has rebranded to just “Strategy” because, as we all know, “hodling” Bitcoin is the only strategy Saylor cares about. 

(Source: Giphy) 

In short, the company now sports a stylized “B” logo and an all orange color scheme (just like Bitcoin), because subtlety is for cowards. They even launched a merch store, so you can now wear your Bitcoin cult membership on your sleeve—literally.

So yes, this is just another trip down Michael Saylors path dedicated to becoming the Bitcoin messiah. What’s more is that Strategy (still feels weird to say) isn’t doubling down on Bitcoin—it’s tripling, quadrupling, and damn near YOLOing into it. Their latest move involves a $563.4 million preferred stock offering to buy even more Bitcoin, because why stop at 471,107 BTC when you can own the entire supply by 2030?

(Source: Yahoo Finance) 

In fact, here are some more numbers that matter: Strategy has 71,107 BTC on the balance sheet (largest corporate holder on Earth). Their latest Bitcoin purchase was 10,107 BTC at $105,596 per coin, bringing the new total cost basis to $64,511 per BTC (and making every 2021 Bitcoin buyer feel slightly better).

Meaning, with Bitcoin looking to ascend from its $96k price level, Strategy is basically a leveraged Bitcoin ETF with a side hustle in enterprise software. Mizuho even slapped a $515 price target on the stock, calling it a “Lever for the Believer”. 

(Source: MSN) 

However, with that said, not everyone is feeling the same vibe here. For one thing, the company’s valuation is too rich compared to its Bitcoin holdings, plus its aggressives stock issuance totaling $563 million could rapidly dilute existing shareholders. Not to mention Bitcoin’s volatility just adds a whole new level of anxiety here, even for the crypto bulls.

But despite the skepticism, Strategy’s shareholders just approved an increase in authorized stock, giving the company even more flexibility to raise capital and keep its Bitcoin-buying spree going. Translation: Saylor isn’t done stacking. Not even close.

(Source: Giphy) 

Additionally, if you thought this was just a Bitcoin play, Strategy also dropped a new AI-powered business intelligence platform. Will it matter? Maybe. But again, nobody is buying Strategy stock for its enterprise software anymore. Like stated above, Strategy is officially a high-beta Bitcoin casino, and if you’re holding shares, you might as well just be trading BTC directly. The company’s entire identity is now wrapped around Bitcoin’s fate, and they’re making it painfully obvious.

Of course, if Bitcoin keeps ripping, Strategy goes vertical and Saylor looks like an absolute genius. If Bitcoin tanks, well… with the amount of leverage Strategy has in Bitcoin, things could get ugly fast. Either way, Saylor isn’t blinking—he’s all in, and he wants you to be too. As for me? Hard pass on crypto. 

(Source: Giphy) 

I’m just here for the show, and to see whether Strategies “Strategy” actually pays off or not. For now, keep an eye on Strategy as they continue to be the Bitcoin beacon set upon a hill for all to see, and place your bets accordingly. As always, stay safe and stay frosty, friends! Until next time…

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Stocks.News does not hold positions in companies mentioned in the article.