MicroStrategy Chairman Michael Saylor Urges Long-Term View

MicroStrategy's executive leadership is defending its Bitcoin-centric capital strategy amidst market turbulence. Chairman Michael Saylor and CEO Phong Le addressed concerns over Bitcoin's approximately 50% decline from its peaks and MicroStrategy's ($MSTR+WL) subsequent rough 75% drawdown, with Le explaining the company's design for amplified Bitcoin exposure.

Saylor, who personally holds over 19 million $MSTR+WL shares, acknowledged the difficulty for investors, stating, "We have to be prepared to have difficult years. It might be one year, it might be two years." He advocated for a seven-to-10-year outlook, characterizing the company as being in an investment phase to build its digital credit business.

Le clarified that issuing $MSTR+WL equity above its net asset value to acquire Bitcoin can be accretive on a Bitcoin-per-share basis, shifting the focus from outstanding share count to the amount of Bitcoin attributable per share. Saylor believes prioritizing short-term $MSTR+WL support could compromise its long-term value proposition.

The company's evolving objective is to build what Saylor termed the world's "best credit" business, using proceeds for Bitcoin acquisition, dollar reserves, or capital management. Saylor estimated the digital credit market could grow significantly from its current ~10.5% hurdle rate, anticipating expansion to $1 trillion. The investment thesis hinges on Bitcoin's long-term appreciation exceeding the cost of capital, rather than short-term trading.