Saylor: “MicroStrategy will be the largest Bitcoin bank in the world”
In a recent interview, MicroStrategy founder and executive chairman Michael Saylor revealed his bold vision for the company's future. According to Saylor, the strategy is to transform MicroStrategy from a technology company to be the “largest Bitcoin bank in the world”.
If successful, the strategy would set the stage for a growing number of companies moving towards the Bitcoin standard. MicroStrategy has already made some changes when it added technology services focused on cryptocurrency. The main ones were the creation of technologies for the Lightning Network, such as the creation of email addresses.
MicroStrategy wants to be a “Bitcoin bank”
MicroStrategy's announcement of its transformation into a Bitcoin bank signals a radical change in the company's way of dealing with BTC. Until the completion of this text, the company uses cryptocurrency as a reserve, but keeps its main business focused on technology.
However, the company's aggressive Bitcoin acquisition strategy could increase demand for other services. With a reserve of more than 100 thousand BTC, MicroStrategy has the largest BTC cash among companies listed on the exchange.
Furthermore, the move should position Bitcoin as an essential financial instrument, attracting more institutional investors. In this way, the company's services can contribute to increasing the market value of BTC in the long term.
Emphasizing the role of borrowing capital to buy more Bitcoin, rather than lending it, is already part of the company's stance. But Saylor did not provide further details on how the company would operate with its BTC.
At the same time, he provided some tips on how MicroStrategy could act. With the move, the company would offer Bitcoin-based financial products such as stocks, convertible bonds, fixed income instruments and others.
Eyeing $1 trillion
Michael Saylor sees Bitcoin as the ultimate digital capital, a term used to refer to an asset that outpaces inflation and protects value over the long term. “The more volatility in Bitcoin, the better it attracts high-return investors,” he explained.
Saylor also positions MicroStrategy to profit when Bitcoin becomes an integral component of every institutional portfolio. In this sense, Saylor claims that the company could issue up to US$20 billion in convertible debt, another US$20 billion in preferred shares and US$10 billion in various forms of debt.
With these plans, Saylor expects MicroStrategy to have up to $150 billion worth of Bitcoin. From this position, he believes the company can grow to be worth between $300 billion and $400 billion, dominate the equity and options markets, and expand into the fixed income markets.
Michael Saylor said that Bitcoin currently represents just 0.1% of the world's financial capital, but could reach 7% by 2045. With this projection, Saylor expects BTC to reach $13 million per unit. This prediction is even more optimistic than that of Hal Finney, who predicted BTC at $10 million if it became the monetary standard.
Borrow, don't lend
What's unusual about Michael Saylor's Bitcoin strategy is that, unlike traditional banks, he doesn't lend. Instead of lending money, MicroStrategy borrows money to buy more Bitcoin.
According to him, this is because Bitcoin's underlying growth rate itself is reason enough to continue borrowing.
“It makes much more sense to borrow a billion dollars from the fixed income market and buy Bitcoin at a 50% annual rate of return with no counterparty risk, compared to reversing the equation and finding someone to pay me 12%- 14%,” says Saylor.