I'm not at all saying "this time is different..." - and I have do have healthy skepticism of how far the virtuous cycle can go.
However, I feel like they are missing something.
Bitcoin price drops
MNAV falls
Yet if debt-load is still sane, they can still issue bonds
Money from bonds goes into buy more Bitcoin
MNAV rises
Point being, Strategy has a 18% debt-load. That means price of BTC would need to fall by 75% before their debt-load got to 1:1.
From a pure finance perspective, a company have 50% debt load to assets is considered a healthy company, so they should be able to continue to issue bonds (ie. convertables)
I'm not at all saying "this time is different..." - and I have do have healthy skepticism of how far the virtuous cycle can go.
However, I feel like they are missing something.
Point being, Strategy has a 18% debt-load. That means price of BTC would need to fall by 75% before their debt-load got to 1:1.
From a pure finance perspective, a company have 50% debt load to assets is considered a healthy company, so they should be able to continue to issue bonds (ie. convertables)