Thoughts on this trade…

Go long bitcoin and short MicroStrategy. I get the feeling that whatever happens to Bitcoin, MicroStrategy should underperform. Im not sure of a scenario where MicroStrategy could outperform.

Thoughts? Pitfalls? Flaw in logic? Concerns about execution?

If btc doubles MSTR will most assuredly double as well. Maybe more due to retail and simpler way to be long BTC by proxy.

MRB10 said:

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MSTR is a leveraged BTC play.

Explain your logic.

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I would absolutely agree...and don't understand, but Jim Chanos and several other big short investors are doing this strategy (several are also doing the long BTC, short COIN strategy, as well)...but I'm kinda clueless on how it would work, because I would think the same as you...

I have a little bit of IBIT I've accumulated over time...and I will occasionally sell a deep OTM call (naked) on MSTR to collect their gigantic premium (using as a hedge against my BTC ETF)...done it successfully a few times, but extremely nervous to tempt the MSTR gods and have my face ripped off on a rocketship to $500+

EDIT - I also don't know a lot about MSTR and their leveraged strategy, but Saylor seems very impressive when he explains what he's doing on the business networks, and has me tempted to follow him long (but largely haven't outside of an occasional swing trade)

I would be very careful about shorting MSTR before their next earnings call.

https://www.kerrisdalecap.com/wp-content/uploads/2024/03/MicroStrategy-MSTR.pdf

Interesting as this literally just came across my feed although I believe Saylor has said he is aware

No public BTC treasury company has traded below its Bitcoin NAV for a sustained period.

But at least one is now approaching parity.

As some of these companies raise capital through large at-the-market (ATM) programs to buy BTC, a risk is emerging: If the stock trades at or near…

— matthew sigel, recovering CFA (@matthew_sigel) June 16, 2025

There are nuances but I view it somewhat similarly to buying the Bitcoin version of TQQQ

Mstr has a billion something tax bill due next year. Not sure how they are going to navigate it. The inflation reduction act requires companies at a certain threshold to pay taxes on unrealized gains.

There's a massive risk with share dilution and not enough added liquidity to keep the stock prices afloat.

I personally see no reason to touch MSTR. Just buy btc or an etf or option the btc etfs if you need the leverage play.

Lmao right on cue. These will 100% cause a prolonged bear market when the time comes.

Tron plans to go pubic and form a MSTR type company with Eric Trump pic.twitter.com/5KVTBsvwOT

— db (@tier10k) June 16, 2025

TxAG#2011 said:

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Lmao right on cue. These will 100% cause a prolonged bear market when the time comes.

Tron plans to go pubic and form a MSTR type company with Eric Trump pic.twitter.com/5KVTBsvwOT

— db (@tier10k) June 16, 2025

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I agree...this has SPAC/NFT craze written all over it...

Great point.

Yea I think alot of things can be true at the same time. I've dabbled in a few of the more recent treasury company issuances. Won a few. Lost a few.

In some ways, they seem like this cycle's alt-coins. They're all sort of dilutive relative to eachother. Each has its own "narrative" differentiating its strategy from other treasury company strategies in terms of how it will 1) acquire BTC and 2) strategically position itself once it has BTC.

But they're kind of different from alts in that 1) it's happening in a much more transparent regulatory structure, 2) there's far less leverage involved (at least in terms of the kind of "crypto" leverage we've seen in the past), 3) they aren't pegged to BTC via AMMs (like most alts) and 4) they're doing what most alts should have been doing all along... which is acquire BTC.

I think the bull case for the new treasury companies popping up is that their underlying stockpile is ultimately and acquisition target of a bigger company or bank down the road.

There will almost certainly be another bear, but I don't think these treasury companies will be the ignition. Recent ones will likely be able to hold through a downturn. I just think the equity-holders will get absolutely roasted as the mnav premium drains away while BTC price goes down.

Own BTC. If you can't do that, own IBIT. If you must own a treasury company, own MSTR. The rest IMO is just gambling.

MSTR : Other BTC treasury companies :: BTC : Alts

Listening to this now, it popped up on my feed today and is on topic for this thread.

https://open.spotify.com/episode/6G0hsROLwO4KPwZIvOw9BP?si=-liE7HCfQiKlpzb55Bn0Mw&context=spotify%3Acollection%3Apodcasts%3Aepisodes

Thanks for the feedback. I haven't thought too much about my thesis other than not understanding how MSTR could/should ever outperform BTC over the long run.

I'm a downturn, I'd think MSTR due to leverage should have a more severe downside.

I "think"…

chris1515 said:

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Thanks for the feedback. I haven't thought too much about my thesis other than not understanding how MSTR could/should ever outperform BTC over the long run.

I'm a downturn, I'd think MSTR due to leverage should have a more severe downside.

I "think"…

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I think the downside on MSTR (relative to BTC itself) is more related to mNAV compression in a BTC price downturn than MSTR's debt.

If sh*t hits the fan, equity holders will get diluted into oblivion to satisfy any debt obligations and protect the stash. Granted that scenario is a few years out and unlikely. I'd be more worried about mNAV.

TxAG#2011 said:

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Interesting as this literally just came across my feed although I believe Saylor has said he is aware

No public BTC treasury company has traded below its Bitcoin NAV for a sustained period.

But at least one is now approaching parity.

As some of these companies raise capital through large at-the-market (ATM) programs to buy BTC, a risk is emerging: If the stock trades at or near…

— matthew sigel, recovering CFA (@matthew_sigel) June 16, 2025

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This is the world of BTC miners. And it's absolutely possible for these levered companies like MSTR.

I think if such a company traded below the NAV of their assets for very long, the Board would be at risk for not liquidating the holdings on the market and returning funds to the investors.

What's he doing?

Volatility is good.

@NFLPlayerProps said:

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Volatility is good.

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MSTY and others like it say HELL YEAH!

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I'm dumping it all into Bitcorn. It's a blockchain cash crop play. It's a LOCK.

@NFLPlayerProps said:

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MSTR is up 3,000%+ since Saylor started buying BTC. And now he has STRK, STRF, and STRD in his arsenal to raise capital without diluting the common stock. I would make sure you understand exactly what he's doing before you go down this path.

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From 2021 to 2022, MSTR lost 90% of its value. And that was with just a tiny fraction of the exposure to BTC that it has now.

What in the world do you think is going to happen the next time BTC has a bear market?

And we're talking about the guy who misstated revenues by 25% during the dotcom boom and paid $8M out of pocket to get the SEC to drop charges against him. During that bear market, MSTR lost 99.87% of its value over two years, not getting back to the highs of the dotcom boom until 2024.

Good point on waiting for the upcoming earnings release.

This is the one time accounting changes correct or did that already occur?

Heineken-Ashi said:

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@NFLPlayerProps said:

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MSTR is up 3,000%+ since Saylor started buying BTC. And now he has STRK, STRF, and STRD in his arsenal to raise capital without diluting the common stock. I would make sure you understand exactly what he's doing before you go down this path.

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From 2021 to 2022, MSTR lost 90% of its value. And that was with just a tiny fraction of the exposure to BTC that it has now.

What in the world do you think is going to happen the next time BTC has a bear market?

And we're talking about the guy who misstated revenues by 25% during the dotcom boom and paid $8M out of pocket to get the SEC to drop charges against him. During that bear market, MSTR lost 99.87% of its value over two years, not getting back to the highs of the dotcom boom until 2024.

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No doubt in my mind he's going to end up in prison one day for fraud.

Last day of Q2

MSTR +4.69%
STRK +9.68%
STRF +6.46%
STRD +1.20%

BTC +0.07%

Huh, that's odd. Wonder what's going on