The gaming industry is currently under scrutiny as more and more companies enter the market. The cryptocurrency market has taken a beating from a short-term dip, but it’s not all doom and gloom for investors. A well-known investor offers some insight into how to navigate these turbulent times.,
Masternode.com chief executive officer Michael Saylor has reassured investors that they will not risk losing their investments following a market slump hurting $MSTR and $BTC. Read more in detail here: Michael Saylor bitcoin forecast.
Michael Saylor, CEO of MicroStrategy and a supporter of Bitcoin, is confident that his company’s BTC holdings will cover more than all possible margin calls on Bitcoin-backed loans.
In 2021, the US corporate intelligence and software giant made headlines by making a series of significant Bitcoin bets. MicroStrategy’s decision to convert its treasury reserve into BTC assets was influenced by Saylor.
At the beginning of May, global markets suffered significant losses and Microstrategy’s shares were not spared. The value of $MSTR has fallen by 24% and the value of Bitcoin has also fallen significantly along with the larger cryptocurrency markets.
This has been worrisome since MacroStrategy, the company’s subsidiary, took out a $205 million loan from Silvergate Bank in March 2022, using a portion of MicroStrategy’s Bitcoin as security. The funds were then used to continue MicroStrategy’s BTC acquisition strategy.
If the price of Bitcoin falls too low, the Silvergate loan will be called because the value of the collateral-backed asset falls. It was a hot topic about the company’s earnings call in May, with CFO Phone Le admitting that the company would have to sell some Bitcoin if the price fell below $21,000.
MicroStrategy has a $205 million term loan with $410 million collateral. $MSTR has the ability to capture 115,109 BTC. If the price of #BTC falls below $3,562, the company may need to post more collateral. In the Q1 2022 presentation, see slides 11-12. #HODL https://t.co/9WHsIB6Usx
May 10, 2022 — Michael Saylor (@saylor)
On May 10, Saylor took to Twitter to reassure investors about MacroStrategy’s ability to repay its loans, which required $410 million in collateral. Saylor stressed that the company would have to run out of BTC if Bitcoin’s value fell below $3,562 in order to have no collateral to repay the loan.
Despite the crypto cold, MicroStrategy’s CEO will not sell his $5 billion BTC stock.
The company made headlines in August 2021 when it decided to invest a significant percentage of its money in Bitcoin. It made its first $250 million investment after fulfilling its shareholder responsibilities, providing the company with 21,454 BTC for its treasury shares.
Saylor said at the time that the investment was motivated by the company’s view that Bitcoin is “a stable store of wealth and an attractive financial instrument with greater long-term profit potential than cash to hold.”
Saylor was even more adamant, claiming that Bitcoin was a better investment than fiat money and that the company had made Bitcoin its main asset in its Treasury reserve plan.
In September 2020, MicroStrategy made another major Bitcoin purchase, this time for $175 million, adding another 16,796 Bitcoin to their portfolio. From then on, the company continued to buy BTC, prompting CitiBank to downgrade MicroStrategy’s stock from “neutral” to “sell,” after it planned to make Bitcoin its main treasury reserve asset.
The “Michael Saylor coindesk” is a website that covers the latest cryptocurrency news and updates. The site has reported on the recent market dips that hurt $MSTR, $BTC. Michael Saylor, the CEO of MGT Capital Investments, reassured investors after the markets had a rough day. Reference: Michael Saylor Coindesk.
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