Michael Saylor: The Event That Will Cause Bitcoin to Increase by 10 Times Has Begun

Bitcoin: The Digital Property with Minimal Risks and Liabilities

Bitcoin, the world’s leading cryptocurrency, has been gaining significant attention and adoption in recent years. Many investors and financial experts have recognized its potential as a digital property that offers numerous advantages over traditional assets like commercial real estate and gold. In this article, we will explore the reasons why Bitcoin is considered a digital property without the risks and liabilities associated with other investments, such as commercial real estate and gold. We will also discuss the role of banks, Wall Street, and responsible custodians in managing Bitcoin and the potential for significant price movements in the future.

The Rise of Bitcoin: MicroStrategy’s Bitcoin Holdings

MicroStrategy, a software and business intelligence firm, has been at the forefront of Bitcoin adoption. Since its first $250 million purchase of Bitcoin as a primary holding for its balance sheet, MicroStrategy has continued to make significant investments in the cryptocurrency. As of now, MicroStrategy holds 158,000 Bitcoin, acquired at an average cost of $29,5186 per coin, with a total investment of $4.69 billion. The firm’s co-founder and executive chairman, Michael Saylor, has expressed his intention to continue acquiring Bitcoin in the future.

The Impact of a Spot Bitcoin ETF and Financial Accounting Standards

According to Michael Saylor, the approval of a spot Bitcoin exchange-traded fund (ETF) by the US Securities and Exchange Commission (SEC) and the proposed rule change by the Financial Accounting Standards Board (FASB) will have a significant impact on Bitcoin’s price and adoption in 2024 and beyond. A spot Bitcoin ETF would accelerate adoption and institutional awareness of Bitcoin, while the rule change by FASB would allow companies to show gains and losses on their crypto holdings immediately in their income statements. These developments are expected to attract more investors, including large corporate organizations and money managers, to invest in Bitcoin.

MicroStrategy’s Partnership with Microsoft and the Outlook on Bitcoin

MicroStrategy’s partnership with Microsoft and the integration of artificial intelligence (AI) into its product line have provided a significant boost to its business intelligence business. The company aims to use AI to acquire new customers and accelerate cloud adoption within its customer base. Saylor believes that the approval of a spot Bitcoin ETF will further enhance investor appetite for MicroStrategy, as the company offers a differentiated offering with intelligent leverage and the ability to generate a tax-deferred Bitcoin premium for its investors.

The Timeline for ETF Approval and Bitcoin Halving

While the exact timeline for the approval of a spot Bitcoin ETF remains uncertain, Bloomberg analysts predict that it is highly likely to happen by early January. Saylor emphasizes that institutions are increasingly adopting Bitcoin, and the approval of the ETF is just a matter of time. Additionally, the Bitcoin halving, which is expected to occur in late April, will cut the natural selling of Bitcoin miners in half, leading to a decrease in supply. This, coupled with the increased demand from spot Bitcoin ETFs, is expected to drive significant price movements in the next 12 months.

The Future of Bitcoin: Corporate Adoption and Shareholder Value

Saylor believes that the future of Bitcoin lies in its adoption by corporations as a treasury asset. The introduction of fair accounting principles for cryptocurrencies by FASB allows companies to mark up and down the value of their Bitcoin holdings, enabling them to generate shareholder value with their balance sheets. Saylor argues that the existing accounting system favors credit and sovereign debt, which are not keeping up with the cost of capital. By leveraging their balance sheets and investing in Bitcoin, companies can beat the cost of capital and generate significant shareholder returns.

The Importance of Responsible Custodians and Industry Rationalization

To move the industry to the next level, Saylor emphasizes the need for responsible custodians and adult supervision in the crypto space. He believes that big banks and Wall Street should take on the role of custodians for Bitcoin, ensuring the security and stability of the asset. Additionally, Saylor suggests that the industry should shift its focus away from the numerous crypto tokens and instead concentrate on Bitcoin, which is universally recognized as a commodity. By doing so, the industry can avoid the risks and liabilities associated with unreliable tokens and custodians, ultimately leading to significant growth and value creation.

MicroStrategy’s Success and Bitcoin’s Potential

During MicroStrategy’s recent earnings call, Saylor highlighted the remarkable success of the company since adopting a Bitcoin standard. The firm’s stock price has increased by 242% since August 2020, surpassing Bitcoin’s own 192% increase during the same period. Saylor attributes this success to the adoption of Bitcoin and its ability to outperform traditional assets like gold, silver, and bonds. He believes that the approval of a spot Bitcoin ETF and the introduction of fair accounting principles will further drive Bitcoin’s price and adoption, potentially leading to significant upside movements.

Frequently Asked Questions

1. What is a spot Bitcoin ETF?

A spot Bitcoin ETF is an exchange-traded fund that allows investors to gain exposure to Bitcoin without directly owning the cryptocurrency. It tracks the price of Bitcoin and provides investors with an opportunity to invest in Bitcoin through traditional brokerage accounts.

2. How will the approval of a spot Bitcoin ETF impact Bitcoin’s price?

The approval of a spot Bitcoin ETF is expected to increase institutional awareness and adoption of Bitcoin. It will provide an on-ramp for capital from Wall Street, leading to increased demand for Bitcoin. This increased demand, coupled with the halving of Bitcoin supply and other factors, is expected to drive significant price movements in the future.

3. What is fair value accounting for crypto assets?

Fair value accounting for crypto assets allows companies to show gains and losses on their crypto holdings immediately in their income statements. This accounting principle eliminates a major impediment to corporate adoption of Bitcoin as a treasury asset and enables companies to generate shareholder value with their balance sheets.

4. Why is responsible custodianship important for Bitcoin?

Responsible custodianship ensures the security and stability of Bitcoin as an asset. Big banks and Wall Street taking on the role of custodians can provide the necessary expertise and infrastructure to safeguard Bitcoin holdings. This will instill confidence in investors and contribute to the industry’s growth and maturity.

5. How can Bitcoin be used as a treasury asset?

Bitcoin can be used as a treasury asset by corporations to diversify their balance sheets and generate shareholder value. By leveraging their balance sheets and investing in Bitcoin, companies can potentially beat the cost of capital and achieve significant returns. The introduction of fair accounting principles further facilitates the adoption of Bitcoin as a treasury asset.