“Nothing Issue” — MicroStrategy CEO Saylor Says No Cause For Alarm Despite Losing $1B In Bear Market

MicroStrategy Is Now Paying Its Board Of Directors In Bitcoin Instead Of Dollars

CEO of software and cloud engineering behemoth, MicroStrategy, Michael Saylor, has said he is not losing sleep over the crypto markets despite his company losing over $1 billion via its Bitcoin investments.

In a series of tweets allaying fears over increased pressure on the MicroStrategy (MSTR) share price, Saylor confirmed that MicroStrategy is buoyant enough to withstand further declines in BTC price, up to $3,500.

MSTR Plunges

MicroStrategy boasts the single largest corporate Bitcoin holdings, and with cryptocurrencies now in a full-fledged bear market, the tech company has borne the brunt of BTC price declines. According to Bitcoin Treasuries, the firm’s 129,218 BTC is being held at a net loss of over $1.1 billion.

Earlier this week, rumors began to intensify over a potential default on a $205 million loan used to purchase those holdings. These rumors indicated that a BTC/USD drop below $21,000 would trigger a margin call, which would require MicroStrategy to respond with extra capital or risk losing its position. This did occur, as BTC plunged to lows around $20,800, but the firm did not flinch. In fact, going by his tweets, Saylor appears bullish on its Bitcoin approach.

Taking to Twitter, Saylor wrote, “When MicroStrategy adopted a Bitcoin Strategy, it anticipated volatility and structured its balance sheet so that it could continue to HODL through adversity.”

In Saylor’s tweets, he referenced a previous tweet after BTC prices had dropped to a 10-month low of $23,800 in May. In the previous tweet, he outlined MicroStrategy’s contingency plans, stating that even if all the available BTC were posted as collateral for the $205 million loan — indicating a BTC price of under $3,600, the March 2020 bottom — the available cash would not end there. 

Speaking to mainstream media in a subsequent interview about MicroStrategy’s financial health, he said “That’s all FUD. We started with $5 billion of unpledged collateral, we borrowed $200 million against it, so that’s a loan-to-value ratio of 4%. If Bitcoin fell 95% from that number then we’d have to post additional collateral.”


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