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MicroStrategy is the largest corporate Bitcoin holder, owning 1.2% of Bitcoin’s 21 million supply, with a vision to evolve into a Bitcoin-focused merchant bank.
Key Notes
MicroStrategy holds 252,220 BTC worth over $15 billion, acquired through debt and equity.Saylor aims for MicroStrategy to become a Bitcoin-focused merchant bank, managing $100-$150 billion in Bitcoin.Saylor predicts Bitcoin could grow 29% annually, pushing its value to $13 million per coin by 2045.MicroStrategy Inc (NASDAQ: MSTR) is aiming for a $1 trillion valuation by becoming the world’s top Bitcoin bank. Michael Saylor, the company’s founder and executive chairman, shared this plan in a recent discussion with analysts at Bernstein, a research firm, as reported by The Block.
Since 2020, MicroStrategy has been acquiring Bitcoin, using both debt and equity to increase returns beyond traditional investments. Last month, the firm added 7,420 BTC, bringing its total holdings to 252,220 BTC, now worth over $15 billion. With total costs of around $9.9 billion and $4 billion in debt, MicroStrategy is the largest corporate Bitcoin holder, owning 1.2% of Bitcoin’s 21 million supply, according to Bitcoin Treasuries.
Photo: Bitcoin Treasuries
MicroStrategy’s $1 Trillion Bitcoin Vision
Under Michael Saylor’s leadership, MicroStrategy has shown a strong belief in Bitcoin’s future. If his vision proves accurate and the firm manages billions in Bitcoin, the results could be transformative. Saylor explained the goal is for MicroStrategy to evolve into a Bitcoin-focused merchant bank, offering financial products like equity, debt, and convertibles centered around Bitcoin.
Bernstein’s digital asset expert, Gautam Chhugani, noted that Saylor considers Bitcoin the world’s most valuable asset. Saylor aims for MicroStrategy to handle $100-$150 billion in Bitcoin via preferred stock, debt, and other instruments. His plan is to leverage volatility to build a $300-$400 billion enterprise and eventually transform MicroStrategy into a $1 trillion firm.
The strategy hinges on Bitcoin’s role as deflationary money. Currently, Bitcoin represents just 0.1% of global financial capital, but Saylor predicts this could rise to 7% by 2045, pushing Bitcoin’s value to $13 million per coin. Rapid expansion is possible if US capital markets continue supporting MicroStrategy’s fundraising through debt and equity. In his base case scenario, Saylor expects Bitcoin to grow at 29% annually.
When asked about scaling their debt strategy, Saylor was confident and said:
“I don’t have any problem seeing how we could raise $100bn more capital and then $200bn after that. It’s a trillion dollar asset class going to $10tn and then going to $100tn. The risk is very simple — it’s bitcoin. You either believe bitcoin is something, or you believe it’s nothing.”
Saylor Eyes 50% Bitcoin Returns
Chhugani outlined Saylor’s view on Bitcoin’s impressive annual growth, which boosts profits through market strategies, avoiding traditional banking. Saylor stated it’s smarter to borrow large sums from fixed-income markets and invest in Bitcoin at a 50% annual return without taking on external risk, rather than searching for someone to pay 12%-14%.
The MicroStrategy founder argues that lending to traditional entities, such as individuals or governments, carries greater risks than Bitcoin investments. He confirmed the company has no plans to lend its Bitcoin. Instead, they aim to borrow large amounts of capital and invest directly in Bitcoin for high returns without counterparty risk.
Saylor further explained that borrowing $10 billion, offering slightly higher returns to lenders, and investing in Bitcoin at 30%-50% yields is more profitable and secure. He predicted that even accounting for volatility, Bitcoin could grow by 22% annually over the next decade, a return difficult to match elsewhere.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
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With over 3 years of crypto writing experience, Bena strives to make crypto, blockchain, Web3, and fintech accessible to all. Beyond cryptocurrencies, Bena also enjoys reading books in her spare time.
