MicroStrategy, led by founder and executive chairman Michael Saylor, is positioning itself to become a leading player in the Bitcoin banking sector.
In a recent interview with analysts at Bernstein, Saylor outlined the company's endgame, which involves borrowing capital at low rates, offering slightly higher returns to lenders, and investing the proceeds into Bitcoin.
Since 2020, MicroStrategy has aggressively acquired Bitcoin, leveraging debt and equity to bolster its holdings. The firm currently owns 252,220 BTC, valued at over $15 billion, with a total investment cost of approximately $9.9 billion.
This positions MicroStrategy as the largest corporate holder of Bitcoin, representing about 1.2% of the total Bitcoin supply.
Saylor believes that Bitcoin is the top-performing asset of the 21st century, viewing it as a hedge against inflation and a long-term store of value. He predicts that Bitcoin will eventually account for a larger share of global financial capital, estimating a potential price of $13 million per Bitcoin by 2045.
The firm's strategy diverges from traditional banking models, as Saylor argues that investing in Bitcoin presents less counterparty risk compared to lending to individuals or corporations.
He stated that MicroStrategy plans to continue borrowing from the fixed income market while investing in Bitcoin, aiming for an average annual return of 29%.
Despite the challenges of scaling this model, Saylor expressed confidence in the firm’s ability to raise substantial capital, envisioning a company that could grow to a trillion-dollar valuation.
Other companies, including Bitcoin miners and exchanges, might want to adopt similar treasury strategies, though Saylor noted that MicroStrategy's unique market position makes it difficult for others to replicate its approach.