There will never be another Buffett (#974746) I sometimes say, but Mr. Saylor is getting pretty close. A true GIGANTIC element in our industry, with returns that aren't actually that impressive...
Here's some random Substack saying, actually, Strategy's is performing worse on its bitcoin than the liabilities it's trying to offload to unsuspecting randos. (#1409654,
#1410584)
Strategy entered 2025 like a legacy artist returning after a 25-year hiatus, back in the spotlight with hit comeback record, convinced the world tour would sell out. An all-time intraday high of $543 in 2024 had the market treating the company as the valedictorian of corporate Bitcoin adoption. The narrative felt inevitable. People were saying stuff like “game changer” but here’s the thing about comeback tours: everyone remembers the big entrance, the first two songs, the “oh my god they still have it” moment. Nobody thinks about the part where the artist has to play Tulsa on a Tuesday and the new album isn’t hitting.
"Markets are unkind to narratives that confuse timing for skill.""Markets are unkind to narratives that confuse timing for skill."
That's another perennial Buffett conversation... was he any good, or did he just get (fiat) lucky? Is he, Taleb style, the one who survived 10,000 rounds of double-or-nothing Russian roulette?
The company’s first Bitcoin purchase of 21,454 BTC for roughly $250 million, disclosed on August 11, 2020 was genuinely historic. It marked the birth of Bitcoin as a corporate treasury reserve asset. Since inception, Strategy’s Bitcoin holdings have delivered approximately a 23.3% total return. Annualized, that’s roughly 4.66%.
(TRUST, DON'T VERIFY... I'm reporting the author's numbers here, have not double-checked... seems ballpark correct.)
Much of this Bitcoin was financed through dilution of common equity. With $MSTR down nearly 50% year-to-date, CEO Phong Le publicly stated that the company was comfortable with the stock’s level and continued issuing shares to acquire more bitcoin, betting that scale alone would overpower valuation gravity.
...but at scale -- another lesson from Mr. Buffett -- your returns are just average. There's only so much alpha you can generate when you're an elephalpha (SORRY, couldn't resist that made-up pun!) (#1232905)
From a historical perspective, this pattern is familiar. Leverage works until it doesn’t. Financial engineering can amplify conviction but it cannot replace timing. Bitcoin does not need a wrapper. It does not need dilution. And it certainly does not need an equity multiple to justify its existence.
FUCK IS THAT SOME BEAUTIFUL LINES. Yessir. Extra zaps to Mr. Mikey!
Another bitcoiner with a fundamental misunderstanding of Strategy.
"With the passage of the GENIUS Act and the likely approval of the CLARITY Act, institutional investors and large funds will soon have direct, regulated access to Bitcoin. When that happens, the need to access Bitcoin through a leveraged equity proxy like $MSTR diminishes significantly."
Strategy's product is not $MSTR, its:
STRC
STRE
STRF
STRD
STRK
Insurance companies, pensions, banks, and other institutions, unless they want to be 200% overcollateralized, can't hold bitcoin as a base asset, when they could have to pay billions for a hurricane or wildfire disaster in a single year (in the case of insurance, for instance). What if bitcoin is down 70%?
Banks are starting to figure it out, are buying STRC, raking in 10%, and offering their customers 4% "high yield" savings and CDs.
Not everyone can use the volatility of bitcoin. Strategy strips the volatility, gives it to the shareholders, and sells a product that much of the world is starving for.
If you don't understand Strategy, that's perfectly fine: you SHOULD hold most of your wealth in bitcoin only. But what if you have enough bitcoin, and want to invest, instead of save?? Strategy is one of the only real investments that has a chance of growing in bitcoin terms.
I understand the Saylor hate: his rhetoric changed from bitcoin maxi, to fiat maxi, when things started getting big. In my opinion, his understanding of bitcoin did not suddenly disappear, and he is saying what he needs to, in order to get what he wants.
Strategy's "business" didn't really start until the prefs, which are only a few months old, (STRC, at $2 billion, was the largest IPO in 2025)
I'm not sure whether you refer to me or the author. I have a pretty decent grasp of Strategy and its products, as I've laid out in podcast and writings and like 500 SN posts for ~econ. You're welcome to read my actual objections.
I was referring to the author of the substack...
Haven't read anything you've posted, I will, though.
Can you link something here?
long-read for Bitcoin Magazine earlier this year is probs the best place to start for what I do and don't grasp
https://bitcoinmagazine.com/bigread/bitcoin-treasury-companies-how-to-think
my talk with Nik Bhatia about Strategy (#1356919), or this #1350852
some crit echo Jeff Deist: #1291642
A very good article, thank you. You had some good insights and it was a good read.
You do make the point that Strategy is bulletproof, but in some ways it fells a bit too focused on "treasury companies" -- a bit like normies conflate "crypto" and bitcoin.
Your failure modes:
"In the absence of that — say, nobody buys the treasury company issuances, and financial capital flows somewhere else; money printing stops; interest rates on (safer?) government securities shoot up, etc — I don’t see how Strategy’s mNAV doesn’t just collapse back down to 1."
.....>I assume you mean this as a temporary scenario, and not a permanent state? In what (fiat) universe would money printing stop, and government bond rates go up?
"If fund managers or treasury departments or family offices routinely stack bitcoin instead of various Strategy products (or securities of Strategy copy-cats, as the case may be in different parts of the world), the primary reason for bitcoin treasury companies go away."
.....>Yes, this will happen eventually. Is it going to happen in 5 or 10 years?? Likely not. It might happen in 20 years, or 50. The gold standard ended in 1913. People thought fiat would die in 1971 -- I think Strategy has many decades to run a Bitcoin/Fiat carry trade.
My projection, which I didn't get into in that article, is that it happens in a few years, conditional on tradfi grasping bitcoin.
Which is what they have to do to answer the very simple question before investing in the Strategy products: where does the yield come from?
Once they get that, all these investment mandates and regulatory barriers will come crashing down very fast and Strategy turns into an ETF with 1:1 bitcoin exposure
You just might be right:
If you don't understand bitcoin, you won't buy Strategy's financial products.
If you do understand bitcoin, you will just buy bitcoin.
Maybe...but STRC is $3 billion and growing.
I don't think banks, insurance, and tradfi in general will understand bitcoin any time soon, when only .001% of the population does. Even if they did, they can't meet short term fiat liabilities with bitcoin as a treasury asset. Yes they need some bitcoin, but they would need a small percentage for growth, and a large percentage of more stable assets to meet shorter term obligations. That is, in today's fiat world, not in a bitcoin future.
Confidence begets confidence. Phong or other CEO's aren't going to yell "fire!". Too much is at stake. Their concerns are buried like candy bars in a backpack when a fat kid goes to fat camp.
I think you got something there -elephalpha. MSTR, on the other hand, doesn't.
Uber alpha
isn't that the witch from Wicked?
I have to again buck the SN trend and agree with e.o.t.s, this financialization of Bitcoin, this stonkification is in the kindling stages, as soon as the institutional size companies start weighing into this, it's going to blow up
Again whether you hate that Bitcoin is being taken away from the p2p toxic maxi fuck the banks fuck the state narrative, is unfortunately irrelevant to institutions, insurance companies and pension funds etc
What Saylor and others have done is shown the world that everyone can have access to the hardest money known to man, just they'll have to use a less hard custodasized, bastasized version, which in return for a stable income, they'll sell their grandmother for
The genie is leaving the bottle and yes, it might well all come crashing down and the only thing left is self custodied onchain and Lightning, the entire tradfi system couild collapse and take all the treasury bros with it
But it aint gonna stop them trying it first