@BigpictureBTC @CochranCrypto Because the risk adjusted return would be too good to pass up if STRC price remains flat while BTC is up significantly
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John Proper
5.3K posts
John Proper
@JohnProperBTC
Challenging nocoiners and maxis alike by putting their beliefs to the test
Katılım Kasım 2022
274 Takip Edilen138 Takipçiler
@CochranCrypto The ironic part is why would any BTC l-adjacent investor want to own STRC in a BTC bull market?
Derin Olenik@BigpictureBTC
For anyone saying ‘wait until you see how $STRC trades in a bull market’, serious question for you: Why, in a Bitcoin bull market, would BTC-adjacent investors choose a high-risk structured yield product offering a capped, variable, non-guaranteed yield, when BTC or ETFs like IBIT would deliver far higher expected returns with zero issuer, credit, or liquidity risk and uncapped upside? The answer must be they are not targeting BTC-adjacent investors at all, yet that strategy is clearly fundamentally broken. $STRC is a classic retail-designed high-risk, high-yield instrument. Its natural buyers are yield-chasing retail investors. These investors are willing to accept capped upside, variable/non-guaranteed returns, and material issuer/credit/liquidity risk because they are primarily focused on the yield number. Proper institutions that advise non-BTC-adjacent capital (the broader fixed-income and traditional yield-seeking market) will never recommend this product. The risk-reward profile is too poor once you apply normal institutional standards: unnecessary counterparty risk for a capped return when far cleaner alternatives exist. The current holder base already proves the point ->it is 80%+ retail. The remaining “institutional” ownership is dominated by low-quality crypto entities and shitcoin projects (with APYX and Saturn being the largest holders). That is not serious institutional adoption; it is just other yield-hungry crypto-native players. In short, $STRC is, by design, a product for retail BTC-adjacent yield chasers, not non-BTC capital. When BTC enters its next bull market, there is no logical incentive for these BTC-adjacent investors to hold a capped, variable yield product over an ETF like IBIT or BTC itself. The way Saylor has marketed this product is, to put it lightly, very deceptive.
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2 days until $STRC goes ex-dividend.
In the last month, Saylor has diluted shareholders to:
-Increase cash coverage to 20 months
-Raise the dividend to 12%
-Fund a STRC buyback program
-Increase distributions to twice a month
Yet STRC is still trading at $87.
The market is telling you exactly what it thinks of Saylor’s “Strategy”: it doesn’t trust it and is pricing in the high risk accordingly. Financial engineering has reached its structural ceiling, and periods of Bitcoin underperformance expose the fragility of the model as it scales. This is a mathematical reality, not just my opinion.
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@VinnyLingham That’s not how bitcoin works at all. Rest of the network can just follow the fork it wants to
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When one man controls nearly 5% of the Bitcoin, he can decide the fate of Bitcoin.
I’ve been calling this out for years now but nobody cares because number go up…
Let’s watch…
Michael Saylor@saylor
There are 110 things more dangerous to Bitcoin than spam. BIP 110 turns a spam dispute into a consensus change that would invalidate some currently valid, fee-paying transactions. That precedent is the danger. We should save our energy for threats that really matter. $BTC
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@VinnyLingham @hosein_obio If he dumps the “wrong” side then the stock price will reflect how the market feels about that. He doesn’t control anything
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@hosein_obio Ask him what he will do if there’s a chain split and which side he will dump…
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@TXMCtrades @jvisserlabs But will US agents want to use those? In the long run which currency are US agents and Chinese agents going to transact in when dealing with each other?
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@JohnProperBTC @jvisserlabs They'll probably want to use digital yuan or ruble based stablecoins. Those things already exist.
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I am going to spend a good deal on this important take from Matt this weekend on YouTube. As BTC closes in on the 50 day moving average and sentiment is brutal, I think everyone whether you believe in crypto or not, needs to read both the Scott Bessent speech and the Mohammed El-Erian NYT Op-Ed about the importance of the speech for Wall Street. You can no longer have no view on crypto or just call it a speculative asset especially with agentic commerce coming soon.
Bessent said clearly “Digital assets, stablecoins, tokenization, and new payment systems will help to shape the future of money. The United States should not consign itself to the sidelines while that future is built elsewhere.”
Do your homework now
Matt Hougan@Matt_Hougan
Spent my morning reading this recent speech from @SecScottBessent. It lays out a new and defining vision for America's role in the economy for the next 100 years. @elerianm calls it a "remarkably important speech." Bessent organizes his vision around five principles. Principle 3 is, "America will write the rules of the next economy." He gives one example of what this means: "Digital assets, stablecoins, tokenization, and new payment systems will help to shape the future of money. The United States should not consign itself to the sidelines while that future is built elsewhere." If you've wondered how committed Washington is to making crypto succeed in the US, that tells you something.
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@TXMCtrades @jvisserlabs Do you think Chinese or Russian agents are going to want to accept payment in USD-backed stablecoins? Similarly, will US agents want to accept payment in ruble or yuan?
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@jvisserlabs What is meant by "agentic commerce"? Agents conducting their own independent buying and selling separate from the operator's commands? Why does this matter for BTC?
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@BigpictureBTC That yield relative to the risk would simply be too good to pass up in a BTC bull run that even non-BTC investors would have to buy STRC. And if they don’t buy it, then Saylor just buys it back on the open market and gets a really good return for shareholders
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For anyone saying ‘wait until you see how $STRC trades in a bull market’, serious question for you:
Why, in a Bitcoin bull market, would BTC-adjacent investors choose a high-risk structured yield product offering a capped, variable, non-guaranteed yield, when BTC or ETFs like IBIT would deliver far higher expected returns with zero issuer, credit, or liquidity risk and uncapped upside?
The answer must be they are not targeting BTC-adjacent investors at all, yet that strategy is clearly fundamentally broken.
$STRC is a classic retail-designed high-risk, high-yield instrument. Its natural buyers are yield-chasing retail investors.
These investors are willing to accept capped upside, variable/non-guaranteed returns, and material issuer/credit/liquidity risk because they are primarily focused on the yield number.
Proper institutions that advise non-BTC-adjacent capital (the broader fixed-income and traditional yield-seeking market) will never recommend this product. The risk-reward profile is too poor once you apply normal institutional standards: unnecessary counterparty risk for a capped return when far cleaner alternatives exist.
The current holder base already proves the point ->it is 80%+ retail. The remaining “institutional” ownership is dominated by low-quality crypto entities and shitcoin projects (with APYX and Saturn being the largest holders). That is not serious institutional adoption; it is just other yield-hungry crypto-native players.
In short, $STRC is, by design, a product for retail BTC-adjacent yield chasers, not non-BTC capital. When BTC enters its next bull market, there is no logical incentive for these BTC-adjacent investors to hold a capped, variable yield product over an ETF like IBIT or BTC itself.
The way Saylor has marketed this product is, to put it lightly, very deceptive.
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@dotkrueger All of these “problems” aren’t actually an issue with the perpetual pref structure, just a problem of BTC price being depressed. And your proposed structure would suffer from the exact same issue
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The perpetual resetting pref is NOT the right structure, for both investors and issuers.
Investors can't trust the "reset to 100 mechanism". Every single one of the existing investors is now underwater, and they all thought they were getting a high yield money market.
If we get anywhere close to 100, there will be a lot of people who want out. Issuing more of this paper will just push yields even higher.
And Investors can't actually trust that the coupon will even be paid. Despite large Bitcoin reserves, these are not earmarked for specific debt tranches.
But it's the wrong instrument for the issuers as well. We're getting into distressed yield levels, where a simple collateralized bond structure could work just fine.
Like the converts before, these instruments will have to be eventually retired by selling Bitcoin, shares, more traditional debt instruments, or "BitBond" participation notes.
But "iPhone moment"? I don't think so.
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@BigpictureBTC You know they could always raise the cash at the premium and hold on to it until a better entry presents itself. There’s nothing structural about it causing them to buy the top
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The model is structurally designed to buy the top and sell the bottom.
It depends on trading at a premium to acquire more BTC. When that premium disappears, it eventually has to sell. Premiums typically peak near BTC tops and vanish near BTC bottoms.
As it grows, sustaining a meaningful premium becomes increasingly difficult. More dilution is required to generate ever-smaller BPS growth, steadily worsening the risk/reward.
The flaw is structural. It’s a self-limiting model.
Phong Le@phongle
For the 3 months April 6 to July 6, 2026, we increased our Bitcoin holdings 10% to 843,775 Bitcoin, increased our USD reserve 13% to $2.55B, and more than doubled YTD BTC Yield from 3.7% to 7.8%. $MSTR $BTC strategy.com/purchases
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Treat $MSTR like a leveraged ETF. Leveraged ETFs decay over the long term by design, regardless of underlying asset performance, due to volatility drag and compounding. They are powerful high-risk short-term trading vehicles, not long-term investments.
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@Grady_Booch I’m starting to understand “AGI” as shorthand for “a computer just did a thing I never thought it could do”, and is mostly used by people who have no understanding of computers.
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I am happy for you, Ravid.
But this is not AGI.
Ravid Shwartz Ziv@ziv_ravid
The AGI is here - Can an AI agent find my ancestors? I gave my AI agent just one thing: my grandfather's name, born in Poland. That's it. Everything else in this thread was found on its own. 🧵
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@ylecun @VoxJT @elonmusk @Devon_Eriksen_ Do you believe this to be the final form of governance? Or are you open to the possibility of another structure yielding better results?
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@VoxJT @elonmusk @Devon_Eriksen_ I feel sorry for those who equate being a supporter of liberal democracy to being retarded.
en.wikipedia.org/wiki/Liberal_d…
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Elon, this is the moment where you're supposed to wise up and abandon classical liberalism.
If you let takers vote, they will not only take more and more, they will make it more and more rewarding to be a taker, and they will convert more and more makers into takers, forever.
Until the makers cannot carry the takers any more.
Universal suffrage leads to universal suffering.
Elon Musk@elonmusk
@FoxNews Mamdani has built nothing. He is a taker, never a maker.
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@ylecun @ZenGhola_X @seikjaboote @elonmusk @Devon_Eriksen_ Why is that ignorant? What’s the actual difference in practice?
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@ZenGhola_X @seikjaboote @elonmusk @Devon_Eriksen_ Equating representative democracy to mob rule is the epitome of ignorant stupidity.
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@TXMCtrades @BillyM2k Yeah BTC produces no income, but produces gains via appreciation and will almost certainly appreciate faster than their cost of capital. Would it have been a ponzi if a company saw that oil was going to be useful in the 1800s and bought up as much oil rights as possible?
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They can't buy more BTC without a constant stream of new investors willing to be diluted in order to finance it because the rest of the business does not make profit. Without new investors willing to be diluted and thus buying their financial products, the continuation of the trade fizzles out and they're just a company that owns BTC, which also produces no income. That is literally ponzi adjacent. It's plain as day.
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i asked ai why microstrategy isn’t a ponzi and it was just like “it’s not a ponzi because it is upfront about new investor money being used to pay out old investors”
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@TXMCtrades @BillyM2k That doesn’t make it a ponzi. Business works fine without raising anymore cash. Just relies on BTC appreciation. To argue that it’s a ponzi is mistaken
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@JohnProperBTC @BillyM2k Because that is the only way the company can raise cash to buy bitcoin. Their software business is breakeven at best.
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@BitPaine @BobLoukas Why is having a large amount of BTC valuable in and of itself? What extra utility do you get out of it by having a large amount?
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unless you think having the largest hoard of capital in the world has long term value.
If you think Bitcoin is going to be a de minimis amount of global capital then perhaps that doesn’t sound significant.
But if you think it’s going to be a $100T asset then the company that holds an insurmountable quantity of it will trade ad a multiple and find ways to generate yield.
it’s really a question of how important do you think Bitcoin is going to be.
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Unless bitcoin literally dies, this is the buy of the century for MSTR.
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@nickgiva1 Why would Strategy care if STRCis trading at $50? Or mNAV at .5x?
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Indeed they don't. If they want STRC at 50 (20%++ yield) and their stock at 0.5x mNAV.
To be clear: I am not one of those idiots who think MSTR gets liquidated, as there is no mechanism for that. But there is a mechanism for it to trade substantially lower than its mNAV and never fully recover, even in a BTC bull market.
MikeWMunz 🟧@mikewmunz
@nickgiva1 They don’t need to do either of these
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@TXMCtrades @BillyM2k Why exactly do you think it requires a new stream of buyers?
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@BigpictureBTC MSTR does not require to be trading at a premium. It only needs Bitcoin to perform. Your thesis is dead wrong
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I warned you guys…and have been since last summer, right at the top. While myself and a few others were mocked and insulted by the $MSTR cult, our thesis was grounded in mathematical observation, capital markets behaviour, and Bitcoin fundamentals. No sympathy from me, the risks were obvious to anyone willing to look.
That said, Saylor does deserve legal scrutiny as events continue to unfold.
As the market learns these lessons, the “Treasury 2.0” framework created by @shoneanstey will emerge: Bitcoin-native operating models that earn sats by treating Bitcoin as money directly on the network, not solely as a scarce asset to be accumulated through dilution. This will correctly represent Bitcoin in capital markets and realise its core value proposition as a superior global monetary asset.
This is already happening behind the scenes. Ignore fiat-driven salesmen, follow the Bitcoin builders.
Derin Olenik@BigpictureBTC
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@CryptoKaleo @mikealfred Why is it dumping? Do you think it’ll continue to dump if BTC bounces back?
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@mikealfred Might be a decent idea to understand why it’s dumping before you post stuff like this Mike
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MSTR getting extremely oversold. If you were listening to me since Q4 2024 you never got overly exposed to this. All that said, at these levels the bounce could be explosive. Nothing fundamentally wrong with Bitcoin. Fear always fades. Don’t get sucked in to the mania either way.
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