Wei Liu
619 posts
CFTC guidance advances Bitcoin capital markets: 24/7 trading, BTC collateral, perpetual futures, options, and regulated access. Good for $BTC holders, powers the $MSTR engine, and supports the rise of $STRC as Bitcoin-backed Digital Credit.
CFTC@CFTC
Commission Staff Confirms the Categorization of Certain Crypto Asset Perpetuals as Foreign Futures and Issues No-Action Letter Regarding FCM Transfers of Customer Crypto Assets to Foreign Brokers as Margin: cftc.gov/PressRoom/Pres…
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$MSTR has $61,719M BTC.
Selling $30M is okay.
I am ready to sell some puts if the market freaks out.
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$MSTR
One of the most valuable things this space has taught me is humility.
And I mean that in the most practical sense possible.
We are operating in a category that has never existed before.
Uncharted territory being trailblazed in real time by innovators like Saylor, who founded this category himself.
Bitcoin is seventeen years old. The innovation built on top of it is barely a toddler.
And when you are swimming in waters nobody has mapped, the most important thing to remember is to swim at your depth.
You don’t know what you don’t know.
This is not an industry where pulling up a few metrics forms conclusive long term direction.
The market is dynamic, volatile, and influenced by more variables than any single analyst can hold in their head at once.
And yet, in one of the most opinionated communities out there, you will always find people proclaiming to know it all. Proclaiming conclusions in a space that is still writing its first chapter.
Opinions are fine.
But they should be met with a grain of salt.
What I have learned, more than anything, is to follow one of Saylor’s core principles above all others.
Maintain laser like focus.
Because the more time you spend entertaining every projection and every account that claims certainty in an uncertain market, the more you dilute your own conviction.
So who do you trust?
It might be a good idea to trust the judgment of the person who trailblazed the path that brought us all here.
And to look at his track record while you are at it.
-A company that scaled from $1B to $60B.
-A pivot to preferred equity that produced an instrument in $STRC that went from 0 to 10 billion in ten months.
-A treasury that now holds 4% of the entire Bitcoin network.
-A track record that has effectively created a new category of finance..
In a space where most participants are still guessing, there are very few people you can reliably put your capital behind.
Everyone else is just a commentator.
And commentary should be weighed accordingly.
Saylor himself has shown what it looks like in practice.
He believed in the creation of Satoshi enough to bet his entire company on it.
He spent thirty years building before finding his greatest breakthrough.
And when the moment came, he did not let ego dictate the path.
The journey of this ship is not concluded in a few days.
This is a seven to ten year voyage.
And if you decide to jump ship during a storm because someone on the deck told you it was a good idea, that might not be the best decision you ever made.
Stay humble.
Trust the captain.
Ride the ship.
Arrive at the destination.
$BTC $MSTR $STRC
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Since $BTC hit a local high on May 11 at $82,361:
$BTC has corrected around 12%
$ASST has only fallen 5% as of the timing of this post. $MSTR is down 25%
This is interesting because as a Bitcoin proxy, we would expect $ASST to obviously amplify Bitcoin on red days like $MSTR has been doing.
Why is this not the case? Here's some thoughts:
-> Proceeds from $SATA issuance are deployed into Bitcoin, typically within hours, per management's stated practice.
-> When Bitcoin falls, each dollar buys more Bitcoin.
-> BTC per share improves faster at lower prices.
The market is not pricing spot NAV. It is pricing forward Bitcoin Yield acceleration. See @RoaringRagnar spreasheet.
Three conditions make this work that $MSTR cannot replicate cleanly right now:
1. Zero debt. No convertible note delta hedging creating structural short pressure on the common equity during drawdowns.
2. Perpetual preferred capital. No maturity wall. No refinancing anxiety at the worst possible moment.
3. Daily dividend structure incoming. $SATA trading near par keeps the ATM open. Open ATM means continuous accumulation.
Although this is a small data size, with $SATA running as it is right now it's an incredible observation to watch.
With these dynamics, we can see another reason why @saylor is trying to remove the convertibles and clean the capital structure.
$ASST $MSTR
@ZynxBTC @AdamBLiv @EthanKasner_ @Z06Z07
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$IBIT has seen some outflows in recent weeks but has overall remained a strong HODLer through the bear market.
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Strategy has completed the repurchase of $1.5 billion of its 2029 Convertible Notes at an ~8% discount to par, generating an incremental 0.7% BTC Yield and lowering aggregate debt to $6.7 billion. $MSTR $STRC strategy.com/press/strategy…
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@d_1awrence Could it be that $MSTR being included in some Index in July??
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The ever-brilliant @Varneyco asked me for my take on what the first thing Warsh should do as the new Fed chair.
My answer might surprise you as good ol’ common sense, but hey, sometimes that’s what ya need imho.
Also, two hot stocks reporting this week – one is a walk away while the other is a great pullback candidate. And rumor has it there’s a new ETF that starts trading this Thursday, less than 48 hours from now. 😀
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$MSTR
The journey toward a debt-free future begins.
No Bitcoin sales.
Put simply, the $1.5B of convertible notes due in 2029 have been repurchased at an 8% discount for approximately $1.38B, funded through our USD cash reserves.
As a result, our cash position declined from roughly $2.2B to $871M.
Importantly, the company was very clear about what comes next:
“Strategy remains committed to maintaining a robust cash reserve to support the credit quality of our digital credit securities. We plan to replenish our cash reserve over time through a mix of digital capital, digital credit, and digital equity sales based on market conditions.”
The Bitcoin acquisition announcement was simply a combination of last week’s already announced purchase of 24,869 BTC and today’s debt repurchase update.
The only new capital allocation decision here was the retirement of the convertible debt.
And frankly, it was a good one.
We used cash on hand to eliminate debt at a discount, remove the possibility of those notes converting into equity, and clear one of the most discussed overhangs surrounding the company.
It also signals, at least for now, that management is in no rush to sell Bitcoin.
All in all, the balance sheet continues to get optimized.
Focus now shifts to the $STRC semi-monthly amendment and, hopefully, getting the BitVac charging again.
$BTC $MSTR $STRC
Michael Saylor@saylor
Strategy has completed the repurchase of $1.5 billion of its 2029 Convertible Notes at an ~8% discount to par, generating an incremental 0.7% BTC Yield and lowering aggregate debt to $6.7 billion. $MSTR $STRC strategy.com/press/strategy…
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