Microstrategy is Outperforming the Entire Market, Thanks to Bitcoin
Microstrategy (MSTR) reported their quarterly earnings yesterday. In it, they discussed growing revenues as well as how their stock is up 166% since the adoption of their Bitcoin accumulation strategy.
Microstrategy is vastly outperforming the majority of public companies out there. They're also slightly outperforming BTC itself.
A lot of this comes down to the amount of Bitcoin that they've accumulated. It's pretty amazing to see how well this strategy is working for them.
I've long been fascinated with Microstrategy. They dipped their toes in the water, decided they liked the temperature and then just dove head first into the deep end.
Now, they're one of the largest holders of Bitcoin in the entire world and the adoption of their strategy is undoubtedly being discussed at shareholder / board meetings of other public companies who may wonder if they can get a slice of the performance that MSTR has achieved.
Levering Up and Buying Bitcoin
One thing that MSTR has done is lever up to buy more Bitcoin. Just when people thought that MSTR was at the brim of how much Bitcoin they could buy, they went out and bought more.
All of this public awareness also drove more business to their enterprise software.
They simultaneously:
- Acquired a massive stake in Bitcoin
- Grew their cash generating business
The firm now holds 140,000 BTC, which were collectively purchased at an average cost of about $29,803. CT
The thing that I love about this is that it's something that you can tangibly feel as an individual.
Can you imagine that you focus on acquiring a stake in Bitcoin by consistently dollar-cost averaging while simultaneously focus on generating more cashflow?
As an individual, this might look like setting up a daily automatic buy of Bitcoin. Then you may focus on your job or the business you own or start a side hustle in addition to either of those two.
No matter where you are in life, you have the ability to adopt "the microstrategy" strategy.
Accumulate Bitcoin.
Grow your cash flow.
Accumulate More Bitcoin.
Microstrategy Weighing in Deeper as Revenue Grows
The Bitcoin-savvy firm is also in the process of developing a Bitcoin layer-2 Lightning Network-based Software as a Service tool for corporations. CT
It's clear that MSTR has become somewhat of a "proxy ETF" for BTC. This is relevant because there are plenty of hedge funds, institutional investors and corporations who may want to get a little BTC exposure but who don't want to jump through all the regulatory and board approvals to buy actual Bitcoin.
Instead, they can just buy MSTR which is a publicly traded company. It's well within existing mandates for a lot of companies and institutional money.
MSTR isn't just resting on this thesis of being a proxy ETF - which I think is important. One day I fully expect a "real BTC ETF" that is globaly accepted and highly liquid.
So MSTR's position as a proxy ETF in the long-run isn't solid ground. What they can do, is develop technology that feeds more revenue into their business while continuing to stack sats.
That appears to be exactly what they're doing. They're beginning to RnD a lot of Bitcoin technology for enterprises. This is a huge bet. If they come out with a few good products and services to sell B2B, they could create another massive cash cow... where will that revenue go? I'd bet more BTC.
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Sssh, don't let Gary Gensler hear that :)
Haha love the angle they have taken. Their software strategy has always been meh (I used to sell competing business intelligence software and never lost to them in a head to head deal) but they really are Gamestopping the market aren’t they?
Such an interesting strategy, or I guess it is a micro strategy?
Go crypto go!
I think they are taking to much risk, I don't think it's a good strategy to put all eggs in one basket
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Interesting 🤔