MicroStrategy Exec Defends BTC Despite Crash

MicroStrategy – the software giant that began investing in bitcoin in August of 2020 and has since become one of the cryptocurrency’s biggest institutional supporters – has lost more than $1 billion in BTC following the recent crash.

MicroStrategy Still Thinks BTC Is the Bomb

Bitcoin and several other digital currencies are not doing well as of late. In fact, they’re in very bad positions. BTC, for example, had reached a new all-time high of approximately $68,000 per unit in November of last year. Today, it is trading for just barely over $20,000 per unit, meaning that virtually all the gains the currency has made over the past five years have disappeared. The currency is down by roughly 70 percent while assets like Ethereum are even lower, trading about 75 percent below their all-time highs.

Despite the bearish news, Michael Saylor – the CEO of MicroStrategy – continues to defend BTC, claiming in a recent series of tweets and social media posts that it’s the best thing for the decentralized finance (defi) space.

On Twitter, Saylor wrote the following:

The sound ethical, economic, and technical foundation for defi is #bitcoin. The next generation of defi will be built using the #Lightning protocol and the #BTC token.

He was also quick to comment on recent behavior from the Securities and Exchange Commission (SEC) surrounding crypto regulation. He said:

Today, @GaryGensler discussed #crypto regulation with @WSJ. Other than #bitcoin, most cryptos (especially PoS networks) represent unregistered securities lacking the full & fair disclosures necessary to protect investors.

There is a dark cloud hovering over MicroStrategy in that it recently took out a huge loan to purchase even more bitcoin units. This occurred prior to the recent bloodbath that began taking place, and it was stated that if bitcoin fell to $21,000 or lower, a margin call would be in order. Now that the asset is below that threshold, people are wondering if that call is coming.

Saylor, however, is working to assure traders that the company is in a good place and that no call has been made yet. He stated:

As long as the Silvergate loan remains collateralized with an LTV less than 50 percent, there is no margin call. We manage accordingly.

In a separate discussion, he mentioned:

The margin call thing is much ado about nothing.

Leading a Trend?

MicroStrategy – prior to its bitcoin buys – was known for software production, though now the company has become synonymous with the world’s number one digital currency by market cap. The company began trading BTC roughly two years ago and hasn’t stopped since.

At one point, the firm owned more than $5 billion in BTC funds, though this number has likely gone down significantly with the recent bear market in play. The company has, however, inspired many other institutions – like Square – to take BTC seriously and begin investing.

Source: Read Full Article