Bitcoin’s much-anticipated spot ETF launch is viewed as a bullish event for the industry by Michael Saylor, co-founder and executive chair of MicroStrategy (MSTR). In a recent Bloomberg interview, Saylor discussed how the Bitcoin ETF differentiates from MicroStrategy’s stocks for potential and existing investors.
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MicroStrategy is commonly seen as a Bitcoin proxy, largely because of its substantial Bitcoin holdings. According to data by Bitcoin Treasuries, it ranks as the top public holder of Bitcoin.
However, Saylor was questioned about whether the ETF launch would negatively impact MSTR. Saylor responded, “ETFs are unlevered and they charge a fee. MicroStrategy is an operating company, so we’re fairly unique.”
Bitcoin spot ETF fundamentally different
Saylor emphasized that MicroStrategy can generate additional Bitcoin through P&L or capital markets operations. He likened MicroStrategy to an airline in comparison to ETFs being like shipping lines, offering higher performance and leverage without fees. He added, “And we can take advantage of intelligent leverage. Like we can borrow money at 0% interest for many, many years [to buy Bitcoin].”
The executive also confirmed that the company will continue to buy Bitcoin, saying, “So our goal is always to find a way to pursue more Bitcoin, per share for our shareholders.”
MSTR’s BTC price-to-cost ratio improves
MicroStrategy, the leading holder of Bitcoin, has seen its Bitcoin value-to-cost ratio improve in December after several months of value decline. While the company’s market capitalization stands at $9.1 billion, a staggering 83% of this value is attributed to its Bitcoin holdings at press time. And a rise or fall in the Bitcoin price impacts the company’s valuations substantially.
MSTR market valuation. Source: Bitcoin Treasuries
Looking ahead to 2024, Saylor also predicts a major bull run for Bitcoin.He also highlighted that market volatility offers more opportunities for the company to enhance shareholder value.
Additionally, Saylor anticipates that the approval of spot ETFs in January will trigger a demand shock. Further, he points out that in April, a supply shock is expected when the daily availability of Bitcoin from miners halves from 900 to 450, further impacting Bitcoin’s price.
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