If there’s one company that has truly mastered the art of turning equity into cryptocurrency, it’s Strategy — formerly known as MicroStrategy.
"from a dusty enterprise software vendor to a bitcoin-gobbling machine"
what a wonderful description. Also: More stock sales for bitcoin purchases. Dudez running this behemoth have balls of steel... and likes to billion-dollar-cost-average.
FT's Alphaville authors are profoundly unimpressed.
though, this arbitrage is too good to be true (#957321)
Why stop now? As long as the market is willing to value Strategy’s shares at more than double the net asset value of its bitcoin stash, executive chair Michael Saylor will keep issuing stock to buy more. It’s a gloriously self-reinforcing loop: every share sold above NAV is, by definition, accretive. The arithmetic is brutally straightforward, and as long as the music plays, Strategy will keep dancing.
When will it end?!
Some may scoff and say Strategy is little more than a leveraged bitcoin ETF wrapped in a corporate disguise, with a capital structure that subordinates the interests of its common stockholders,
Some may say that... and, they'd be right. End of.
For now, though, with bitcoin flirting with $97,000 and investor appetite for Strategy’s stock showing no signs of waning, Strategy’s strategy is working. Investors keep betting on bitcoin as a hedge against dollar debasement and keep paying a hefty premium to access the Saylor spectacular.
Maybe it never ends, bitches. Maybe we financially-engineer tradfi assets until they're all bitcoinized and the world is different (=better).
That'd be something, eh.
forgot non-paywalled (THANKS, EDIT FUNCTION!) but I also think Alphaville is open?
https://archive.md/r9BSN