TL;DR

• BTC swallowed $MSTR, now Michael Saylor’s BTC strategy is either going to be one of the greatest triumphs or failures in investing history (our guess is the former).

Full Story

Body Snatchers (1993):

A teenage girl and her father discover alien clones are replacing humans on a remote U.S. military base in Alabama.

Body Snatchers (2024):

A 59 year old man and his software company discover Bitcoin, which then swallows his entire business model, in a remote town in Virginia.

…

MicroStrategy ($MSTR) is in a weird spot.

Sure, it’s technically a software company — but a large portion of its market cap is thanks to the fact that it owns ~190,000 Bitcoin (~$9.74B).

So much so that the narrative around the stock is “buy $MSTR to get exposure to Bitcoin” — instead of “buy $MSTR to gain exposure to the profits of its software business.”

Just look at the correlation between $MSTR’s stock price, and Bitcoin:

Here’s what defines the ‘weird spot’ the company is in:

• If Bitcoin goes up, MicroStrategy stock goes up ✅

• If Bitcoin goes down, MicroStrategy stock goes down ❌

• If MicroStrategy sells any of its Bitcoin, the stock goes down ❌

(See how the reward v. risk is asymmetric?)

The fun part of it all, is this:

With this level of correlation, Michael Saylor’s Bitcoin strategy is either going to be one of the greatest triumphs, or failures in investing history.

(We have a feeling it’s going to be the former).