In a further boost to bitcoin's formative claim as digital gold, $1.2 billion business intelligence company MicroStrategy announced today that it had recently purchased $250 million worth of bitcoin - making it the company's primary treasury reserve asset. CEO Michael Saylor stated:
It's a landmark move for sure. It's the first publicly listed company to make this allocation. Furthermore, the size of the allocation relative to the overall size of the company is not lacking in conviction. The expectation is that others will now follow.May i suggest this to be a new thread? It would be useful to discuss how organisations are starting to use bitcoin and crypto in general
Furthermore, the size of the allocation relative to the overall size of the company is not lacking in conviction
Upon that news yesterday, its share price jumped around 15%. This could also be an indirect way for people to gain exposure to bitcoin - for those that don't want to handle the asset directly themselves. Rather than buy into at a premium they can buy into Nasdaq-listed MicroStrategy instead.I would not be surprised if the share price of the company started following the bitcoin price trajectory as the company is 20% made of bitcoin
MicroStrategy has completed the purchase of a further $175 million worth of bitcoin, bringing its total bitcoin holding to 38,250 btc (approx. $425 million).In a further boost to bitcoin's formative claim as digital gold, $1.2 billion business intelligence company MicroStrategy announced today that it had recently purchased $250 million worth of bitcoin - making it the company's primary treasury reserve asset. CEO Michael Saylor stated:
I had a friend convinced that African countries were in talks with owns of some cypto to take over their ecomonies with huge investment.
The equivalent of putting €5 each way on a 150/1 shot in the Grand National.
By people, are you referring to the $1.2 billion public company (MicroStrategy) discussed in the posts above yours that has bought $425 million worth of bitcoin in 2020?Are people still buying this rubbish?
If you believe something is 'rubbish', it doesn't seem in any way credible to me that you put 1 cent into it. Why would you do that?I put €20 into something called Ethereum I think.
It has often been said that crypto has far more potential in Africa than probably any other part of the world. The crypto subject has been discussed ad nauseum here and I don't remember anyone saying that crypto was going to 'take over' an African economy. Notwithstanding that, it's patently clear that many of them would be much better off had they already adopted it (given flagrant mismanagement of their own sovereign currencies).I had a friend convinced that African countries were in talks with owns of some cypto to take over their ecomonies with huge investment. He put about €20k into it and it's not worth €5k now.
Sounds like your 'friend' isn't a good point of reference for the consideration of cryptocurrency as a proposition.A get rich quick merchant
He'll probably end up thinking he's downloading something from the treasury office in Republic of Congo and end up have any savings he has stolen in a cyber attack.
He put about €20k into it and it's not worth €5k now.
Well, volatility continues to decrease year on year (admittedly a multi year process still). The argument could be made that in 2020, there's a much greater likelihood of major usd volatility than previously. There's also greater upside potential with bitcoin (asymmetric risk). Click on the podcast link in post #467 above to hear Michael Saylor's (MicroStrategy) rationale for buying into bitcoin.I don't understand why a corporate treasurer would hold Bitcoin or be allowed to hold Bitcoin as a treasury reserve asset. The same logic applies as to why they don't hold Equities as a primary treasury/liquidity asset because of the volatility and risk associated.
Well, volatility continues to decrease year on year (admittedly a multi year process still). The argument could be made that in 2020, there's a much greater likelihood of major usd volatility than previously. There's also greater upside potential with bitcoin (asymmetric risk). Click on the podcast link in post #467 above to hear Michael Saylor's (MicroStrategy) rationale for buying into bitcoin.
Liquidity in bitcoin itself has reached a significant level over the course of the past 24 months - akin to daily trading levels of German bonds. It can be easily disposed of in a 24/7 'always-on' market.A significant responsibility of a treasury function is to ensure liquidity of the company.
What is of concern is it's buying power. These companies are utilising bitcoin as a hedge against potential inflation at this time.However the volatility of USD is not of much concern because it is cash and the world reserve currency so the volatility of the USD against other currencies has little impact for a company that's liabilities are in USD.
Will $100 today buy you the same goods/services in 6 months time?Put it this way if I owe you $100 in 6 months, whats riskier putting $100 cash in a bank account, or buying $100 in Bitcoin?
Have a look at from August. Saylor is clearly saying that its capital allocation strategy is mindful of Bitcoin's dependability as a store of value and as a legitimate and attractive investment asset. You could say that those charged with administrating treasury reserves have a responsibility to take steps to protect against the erosion of those funds and Ray Dalio's notion that 'cash is trash'.I am highly dubious they really are holding it as a primary treasury reserve and is rather an actual trade / bet on Bitcoin and they have had to structure it this way due to the trading mandate they have signed with clients.
Liquidity in bitcoin itself has reached a significant level over the course of the past 24 months - akin to daily trading levels of German bonds. It can be easily disposed of in a 24/7 'always-on' market.
What is of concern is it's buying power. These companies are utilising bitcoin as a hedge against potential inflation at this time.
Will $100 today buy you the same goods/services in 6 months time?
Have a look at from August. Saylor is clearly saying that its capital allocation strategy is mindful of Bitcoin's dependability as a store of value and as a legitimate and attractive investment asset. You could say that those charged with administrating treasury reserves have a responsibility to take steps to protect against the erosion of those funds and Ray Dalio's notion that 'cash is trash'.
Will $100 today buy you the same goods/services in 6 months time?
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