Bitcoin Bull (BTC) Michael Saylorco-founder and chairman of MicroStrategy, has expressed a desire to improve “smart leverage” for the company’s shareholders as it continues its strategy of investing heavily in market-leading crypto.
MicroStrategy shares soar 500% in 2024
In a recent interview on Bloomberg Television, Saylor pointed out that MicroStrategy holds $7.2 billion in convertible securities, with about $4 billion effectively acting as equity due to their favorable trading conditions.
He pointed out, “They trade with a delta of about 100%, which is similar to that of stocks,” indicating a strong correlation between convertible bonds and the company’s stock performance.
MicroStrategy has become a significant player in the cryptocurrency landscape this year, actively pursuing a bold plan to raise $42 billion exclusively for the acquisition and custody of Bitcoin.
The company’s shares have surged nearly 500% in 2024, far outpacing Bitcoin’s 150% rise over the same period, attributed in part to the company’s regular announcements of multibillion-dollar Bitcoin purchases , which have taken place every Monday for the past six years. weeks.
Such activities have not only driven up MicroStrategy’s stock price, but also raised questions about the long-term sustainability of this aggressive investment strategy.
The company’s fixed-income securities have attracted the attention of hedge funds looking for opportunities in convertible arbitrage, a strategy that involves buying the bonds while short selling the underlying stocks. This demand facilitated MicroStrategy’s issuance of $6.2 billion in convertible securities this year, strengthening its financing capabilities.
Despite concerns about the viability of its investment approachMicroStrategy’s market capitalization surpassed $90 billion, leading to its inclusion in the Nasdaq 100 Index as trading closed on Friday.
The step could trigger more than $2 billion in stock purchases from funds that track the tech benchmark, according to Bloomberg Intelligence estimates.
Saylor open to crypto advisor role
In a related note, Saylor revealed during the interview that he has actively engaged with members of President-elect Donald Trump’s administration, signaling his willingness to contribute to discussions on constructive issues. digital asset policies.
Saylor said he would be willing to serve on an advisory board for digital assets if called upon as part of Trump’s recent nomination of David Sacks, a former PayPal executive, as his first-ever “trust czar.” AI and Cryptography from the White House.
As before reported per Bitcoinist, this role is designed to oversee the development of government policies regarding artificial intelligence and cryptography, a move that aligns with Trump’s campaign promise to reform U.S. crypto regulations and foster an environment conducive to the growth of the industry.
Sacks will be responsible for creating a legal framework to provide the clarity that the crypto industry has long sought, allowing it to thrive in the United States. Trump remarked: “He will work on a legal framework so that the crypto industry gets the clarity it demands and can thrive in the United States. »
Featured image of DALL-E, chart by TradingView.com
