On the eve of Microstrategy's stock exchange debut In June 1998, founder Michael Saylor stayed in a penthouse suite on the Lotte New York Palace in midtown Manhattan. Saylor, who was 33 on the time, says it was essentially the most exquisite hotel room he had ever seen, paid for by major insurer Merrill Lynch.
The next morning, Saylor went to the Nasdaq trading floor to look at his company's stock open. He recalled seeing a notice above the ticker warning traders: “Please do not confuse MSTR with MSFT.” The latter was one in every of them Microsoftthe software giant that had gone public 12 years earlier.
Shares of MicroStrategy rose 76% of their debut, joining the ranks of tech firms benefiting from the dot-com boom.
“It was a good day,” Saylor told CNBC.
More than 26 years later, MicroStrategy and Microsoft were linked again, but for a really different reason. In December 2024, Saylor went before Microsoft shareholders and tried to persuade them that the corporate, now value greater than $3 trillion, should use a few of its $78.4 billion in money, equivalents and may spend money on short-term investments Bitcoin.
“Microsoft cannot afford to miss the next wave of technology, and Bitcoin is that wave,” Saylor said in a video presentation published on X last week. The post has greater than 3.6 million views.
Saylor is fully committed to this strategy. MicroStrategy has purchased 439,000 bitcoins since mid-2020, a stash that’s now value about $42 billion and the idea for the corporate's market capitalization explosion from about $1.1 billion on the time of the plan's launch to 82 billion US dollars.
On Monday, MicroStrategy said in a filing that it acquired a further 5,262 Bitcoins last week for about $561 million, or $106,662 per coin. This brings the overall holdings to 444,262 Bitcoins.
MicroStrategy's software unit, which focuses on business intelligence, generates quarterly revenue of just over $100 million. After soaring in 1998 and 1999, the stock collapsed within the dot-com bust and lost just about all of its value. In the a long time that followed, the worth slowly recovered before rising rapidly on account of Bitcoin.
Four years after its Bitcoin buying spree, MicroStrategy is a worldwide leader fourth largest ownerbehind sole creator Satoshi Nakamoto, BlackRock's iShares Bitcoin Trust and crypto exchange Binance.
At Microsoft, the shareholder vote supported by Saylor failed resoundingly – lower than 1% of investors voted in favor.
But the spectacle gave Saylor, now 59, one other opportunity to evangelise the gospel of Bitcoin and tout the advantages of converting as much money as possible into this single digital asset. It's a story that has engulfed Wall Street.
MicroStrategy shares are up 477% this 12 months as of Friday's close, rating second AppLovin It ranks amongst all U.S. tech firms valued at $5 billion or more, based on FactSet data. This follows a rise of 346% in 2023.
While the rally was well underway well before November of this 12 months, Donald Trump's election victory, which was heavily funded by the crypto industry, boosted the stock much more. Stocks have risen 60% because the Nov. 5 election and at last surpassed their dot-com era peak in 2000 on Nov. 11.
Saylor has long spoken about Bitcoin in an evangelical way and co-authored a 2022 book about it called “What is Money?” But his critics have recently change into louder than ever, descriptive Saylor as a cult-like leader and his strategy as “Ponzi loop” This involves issuing debt and equity to purchase Bitcoin, watching MicroStrategy's stock price rise, after which doing more of the identical.
“Wash, rinse, repeat – what could go wrong?” wrote Peter Schiff, chief economist and global strategist at Euro Pacific Asset Management, on November 12 Post on X to his 1 million followers.
Saylor, who has 3.8 million followers, addressed the growing chorus of skeptics in an interview with CNBC's “Money Movers” last week.
“Just like developers in Manhattan, every time the value of real estate in Manhattan goes up, they issue more debt to develop more properties. That's why the buildings in New York City are so tall,” Saylor said in a clip posted to X by his legion of fans. “It’s been around for 350 years. I would call it an economy.”
Saylor is a frequent guest on CNBC and appears on various programs throughout the year. He also agreed to two interviews with CNBC.com, one in September and one shortly after the election.
The first of these conversations took place at the Lotte, just a few elevator stops from the penthouse where he stayed before his stock went public on the Nasdaq. Saylor gave a conference keynote speech at the hotel and also attended meetings.
He wore a designer suit and an orange Hermès tie to match the Bitcoin color. The election was less than two months away, and crypto companies were pumping money into the Trump campaign after the Republican candidate and former president previously described Bitcoin as a “Fraud against the dollar” began to ensure a much more crypto-friendly administration.
“Inspired the crypto community”
Two months earlier, in July, Trump gave a keynote speech at the biggest Bitcoin conference of the year in Nashville, Tennessee, where he vowed to fire SEC Chairman Gary Gensler, an industry critic, and said the U.S. was becoming “crypto.” “Capital of the USA” will become “Planet” if he wins.
“I think the election year inspired the crypto community to find its voice, and I think it sparked a lot of latent enthusiasm,” Saylor said in the September interview. “When Trump initially expressed positive comments, it was a big boost for the industry. When it came back completely positive, that was another boost.”
Until this year, MicroStrategy was one of the only ways for many institutions to purchase Bitcoin. Because MicroStrategy was a stock, investment firms didn't need any special regulations to own it. The environment changed in January when the SEC approved spot Bitcoin exchange-traded funds, allowing investors to purchase ETFs that track the value of Bitcoin.
Since Trump's victory everything has been on the right side. Bitcoin is up about 41% and BlackRock's ETF is up 39%. Gensler is preparing to leave the SEC, and Trump has picked deregulation advocate and former SEC Commissioner Paul Atkins to replace him.
Venture capitalist David Sacks, an outspoken conservative who hosted a fundraiser for Trump in San Francisco, will be the “AI and crypto czar of the White House,” Trump announced in a post on his Truth Social platform earlier this month.
“With the red momentum, Bitcoin is rising with tailwinds, and the rest of the digital assets will also start to rise,” Saylor said in a telephone interview with CNBC shortly after the election. He said Bitcoin remains the “protected trade” in the crypto space, but as a “digital asset framework” is created for the broader crypto market, “there might be an uptick in your entire digital asset industry,” he said.
“Taxes are going down. All the rhetoric about unrealized capital gains taxes and property taxes is off the table,” Saylor said. “All regulators’ hostility toward banks touching Bitcoin” is also disappearing, he added.
MicroStrategy has become even more aggressive in its Bitcoin purchases. Saylor said in one post On December 16, he announced that his company had purchased 15,350 Bitcoins for $1.5 billion in six days from December 9.
So far this year, MicroStrategy has purchased over 255,000 Bitcoins, with about two-thirds of those purchases occurring since November 11th.
“We wanted to do it anyway,” said Saylor, referring to the election results. “But the headwind has turned into a tailwind.”
A week before the election, MicroStrategy announced in its quarterly issue Results publication a plan to raise $42 billion over three years. This included a stock sale worth up to $21 billion by financial firms such as TD Securities and Barclays, freeing up significantly more liquidity for Bitcoin purchases.
Saylor told CNBC it was “probably crucial earnings release in the corporate's history.”
No possession is too much for Saylor, who predicted in September that Bitcoin could reach $13 million by 2045, which would represent annual growth of 29%.
“We’re just going to buy higher up forever,” he said in the same television interview in which he compared Bitcoin to real estate in New York. “Every day is a good day to buy Bitcoin. We think of it as cyber Manhattan.”
Saylor speaks enthusiastically about Bitcoin as the foundation of a new digital economy that will only get bigger. But even since he launched his Bitcoin strategy in 2020, investors have faced major problems – the stock lost 74% of its value in 2022 before rising sharply over the past two years.
Nevertheless, he advises companies to imitate his strategy. Microsoft didn't listen, but Saylor said there were a lot of “zombie firms” with core businesses that had nowhere to go and will put their money to raised use.
“The traditional advice would be: When you do a transformational acquisition, you realize you need a merger partner. “You're dead. Find someone to merge with,” Saylor said at Lotte in September. “Bitcoin is the universal merger partner, right? The real appeal of digital capital is that you can fix any company.”
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