Saylor's imperial ambitions and Icarus-like financialization attempts are finally, finally coming entirely apart. Strategy will falter, at the very minimum end and reverse its bitcoin-bank and financial wizardry stunt. #1513171
...and my new favorite financial journalist is Mr. Cohen at the FT — my god, he's cranking out lots of good material these days. #1513175, #1513531
Last few days, financial markets saw:
- STRC, the revolutionary financial instruments underlying digital credit, fall not just away from its 100 targeted "peg" but below $80 in trading.
- Common share, the backdrop of the entire value generation/extraction, quickly dropping to zero — fall to $92 in trading today. Not much dilutive value left; bagholders beware.
Strategy is fucked. Cohen asked AI what it should do:
"We thought that since an AI chatbot had got the company in the bind in the first place, it may have a solution to salvage the situation. So we asked ChatGPT what the company should do""We thought that since an AI chatbot had got the company in the bind in the first place, it may have a solution to salvage the situation. So we asked ChatGPT what the company should do"
@Undisciplined quipped it a few posts ago. I'm betting precious (sorry, increasingly worthless) sats that Saylor won't do it. Dude would have no credibility left, no more fancy conference invites to stroke his ego, no crowds angling for a selfie.
Because...?
The broader problem is that the company can execute the U-turn **only if it can maintain trust. And management has really strained trust** by, for example, taking generational-wealth amounts off the table via insider selling and deviating from its HODL credo.
He'd be just another fallen angel, disgraced by his hubris and burned by bitcoin finance — perhaps, if fate were to allow me the poetic justice, even sharing a cell with SBF.
over time, the company turned a simple capital stack into a rococo baroque balance sheet, first with convertible bonds and later with five different kinds of preferred stock.
"Strategy’s immediate issue is that it keeps undertaking value-destructive steps to keep intact the jerry-built financing structure it has created""Strategy’s immediate issue is that it keeps undertaking value-destructive steps to keep intact the jerry-built financing structure it has created"
It’s imperative that Strategy stops issuing capital just to service capital
...also known as, uh, a Ponzi...
the company has a shot at rescuing this situation if it prioritises its original strategy of bitcoin accumulation and winds up the complicated financial engineering that has led it astray. Recovery will be a daunting task.
Archive: https://archive.md/V1P2T
Maybe it would be different if it wasn't such a cult of personality, but daily posting of stupid slop images of himself with dramatic life-raft, mountain-climber, boxing-champion, basically every exciting meme possible put kind of a fine point on it.
If he admits to all the slop-gobblers that he was just trying to take their money, and really, he doesn't give a shit about bitcoin or plebs or whatever they'd probably...actually, they'd probably just keep gobbling up his slop.
I want to say that he has no credibility left, but Strategy's marketing over the last year was so stupid that it should have turned any sensible investor away. We must therefore conclude that the investors who remain are not really affected by such things as discovering that the CEO of the company in which you are investing is a cartoon.
true... but his whole business model is based on ripping people off, how long can that last?!
Basically, all those easily fooled dupes are already on board. I.e., no growth; and the mechanism depends on new bagholders
Here's my 30,000 ft question: If he runs the strategy in reverse and buys back distressed shares by selling bitcoin, will he have bitcoin left at the end?
If so, isn't his downside pretty much just walking away with a (probably still huge) stack?
"Walking away "
The point is that it's not a huge problem if the bitcoin can actually buy back the shares. The treasury company would still have a bunch of bitcoin behind their shares, for whatever shareholders remain.
That depends on whether bitcoin recovers
That ignores accretion
Sure 👍
Bingo!!
Possibly. At the rate BTC/USD is going, my guess is no.
Either way, even if he succeeds, it amounts to a maaaassive rugpull of absolututely everyone
Beautiful, absolutely beautiful
Ya strategy is really fucked up.
I’m a bag lady
have fun staying poor
Strategy were the people who tanked Bitcoin's price a while back D: