Michael Saylor, president and CEO of MicroStrategy, during an interview at the Bitcoin 2023 conference in Miami Beach, Florida, USA, on Thursday, May 18, 2023.
Eva Marie Uzcategui | Bloomberg | Getty Images
Before MicroStrategystock market debut in June 1998, founder Michael Saylor stayed in a penthouse suite at the Lotte New York Palace in midtown Manhattan. Saylor, then 33, says it was the most exquisite hotel room he had ever seen, and it was paid for by major underwriter Merrill Lynch.
The next morning, Saylor went to the bottom of the Nasdaq to watch his company’s stock open. He recalled seeing a note scrolling across the ticker, warning traders: “Please do not confuse MSTR with MSFT.” The latter belonged Microsoftthe software giant that went public 12 years ago.
Shares of MicroStrategy jumped 76% in their debut, joining the parade of technology companies that have profited from the dot-com boom.
It was a good day, Saylor told CNBC.
More than 26 years later, MicroStrategy and Microsoft are back together, but for a very different reason. In December 2024, Saylor went before Microsoft shareholders to try to convince them that the company, now valued at more than $3 trillion, should put some of its $78.4 billion in cash, cash equivalents and short-term investments into bitcoin.
“Microsoft cannot afford to miss the next technology wave, and bitcoin is that wave,” Saylor said in a video presentation that published X last week. The post has more than 3.6 million views.
Saylor invested everything in that strategy. MicroStrategy has bought 439,000 bitcoins since mid-2020, a stock now worth about $42 billion and underpinning the explosion of the company’s market capitalization to $82 billion from roughly $1.1 billion when the plan was established.
On Monday, MicroStrategy he said in the filing that over the past week or so it acquired another 5,262 bitcoins for approximately $561 million, at a price of $106,662 per coin. This brings his total holdings to 444,262 bitcoins.
MicroStrategy’s software unit, which specializes in business intelligence, generates just over $100 million in quarterly revenue. After rallying in 1998 and 1999, stocks collapsed in the dot-com bust, losing almost all of their value. In the decades that followed, it slowly returned to its former state rocketing because of bitcoin.
Four years into its bitcoin buying spree, MicroStrategy is worldwide the fourth largest ownerbehind only creator Satoshi Nakamoto, BlackRock’s iShares Bitcoin Trust and crypto exchange Binance.
At Microsoft, a shareholder vote backed by Saylor failed by a wide margin—less than 1% of its investors voted for him.
But the spectacle gave Saylor, now 59, another chance to preach the gospel of bitcoin and tout the benefits of turning as much cash as possible into that unique digital asset. It’s a story that Wall Street has been swallowing.
Shares of MicroStrategy are up 477% this year as of Friday’s close, other until only AppLovin among all U.S. technology companies valued at $5 billion or more, according to FactSet data. This follows a 346% increase in 2023.
Although the gathering was in effect long before November of this year, Donald Trump victory in the elections, financed strongly by the crypto industry, boosted the stock even more. The stock has risen 60% since the Nov. 5 election and finally surpassed its dot-com-era high in 2000 on Nov. 11.
Saylor has long spoken about bitcoin in an evangelical way and co-authored a book about it in 2022 titled “What is Money?” But his critics have recently become louder than ever, describing Saylor as a cult leader and his strategy as “ponzi loop” this involves issuing debt and equity to buy bitcoins, watching MicroStrategy’s stock price rise, and then repeating the same.
“Wash, rinse, repeat — what could possibly go wrong?” wrote Peter Schiff, chief economist and global strategist at Euro Pacific Asset Management, in a Nov. 12 article post on X for his 1 million followers.
Saylor, who has 3.8 million followers, addressed the growing chorus of skeptics last week in an interview with CNBC’s “Money Movers.”
“Just like the builders in Manhattan, every time real estate in Manhattan goes up in value, they issue more debt to build more real estate, that’s why your buildings are so tall in New York,” Saylor said in a video posted on X by his legions of fans. “It’s been going on for 350 years. I would call it economics.”
Saylor is a frequent guest on CNBC, appearing on various programs throughout the year. He also agreed to two interviews with CNBC.com, one in September and another shortly after the election.
The first of those conversations was back at Lotte, just a few elevator stops from the penthouse where he was staying the night before his stock plunged on the Nasdaq. Saylor gave the keynote address at the conference at the hotel and led meetings on the sidelines.
He wore a designer suit and an orange Hermes tie, which matched the color of bitcoin. With the election less than two months away, crypto companies have been pumping money into Trump’s campaign after the Republican candidate and former president, who previously called bitcoin “fraud against the dollar,” started guaranteeing a much more crypto-friendly administration.
‘Inspired the crypto community’
Two months earlier, in July, Trump gave the keynote address at the biggest bitcoin conference of the year in Nashville, Tennessee, where promised fire the SEC chairman Gary Genslerindustry critic, and said the US would become the “crypto capital of the planet” if he wins.
“I think the election year inspired the crypto community to find its voice and I think it catalyzed a lot of enthusiasm that was latent,” Saylor said in a September interview. “When Trump was tentatively positive, that was a big boost for the industry. When he came out fully positive, that was another boost.”
Until this year, MicroStrategy was one of the few ways many institutions could buy bitcoin. Because MicroStrategy was a stock, investment firms did not need any special provisions to own it. The environment changed in January, when SEC approved exchange-traded spot bitcoin funds, allowing investors to buy ETFs that track the value of bitcoin.
Since Trump’s victory, everything has been up and to the right. Bitcoin is up about 41% and BlackRock’s ETF is up 39%. Gensler is set to leave the SEC, and Trump has chosen a deregulation advocate and former SEC commissioner Paul Atkins to replace it.
Venture capitalist David Sacks, an outspoken conservative who hosted a fundraiser for Trump in San Francisco, will be the “White House AI & Crypto Czar,” Trump announced earlier this month in a post on his Truth Social platform.
“With the red swing, bitcoin is going up with a tailwind, and the rest of the digital assets are going to start going up as well,” Saylor told CNBC in a phone interview shortly after the election. He said bitcoin remains a “safe trade” in the crypto space, but as a “digital asset framework” is established for the broader crypto market, “there will be an uptick in the entire digital asset industry,” he said.
“Taxes are coming down. All the rhetoric about unrealized capital gains taxes and wealth taxes has been removed,” Saylor said. “Any hostilities from regulators toward banks that touch bitcoin” are also disappearing, he added.
Republican presidential candidate and former US President Donald Trump gestures at the Bitcoin 2024 event in Nashville, Tennessee, USA on July 27, 2024.
Kevin Wurm | Reuters
MicroStrategy has become even more aggressive in buying bitcoins. Saylor said ua publish Dec. 16, that in the six-day period starting Dec. 9, his company acquired 15,350 bitcoins for $1.5 billion.
MicroStrategy has acquired over 255,000 bitcoins so far this year, with about two-thirds of those purchases occurring since November 11th.
“We wanted to do it regardless,” Saylor said, referring to the election results. “But what was a headwind became a tailwind.”
A week before the election, MicroStrategy announced in its quarter earnings announcement plan to raise $42 billion over three years. This involved selling up to $21 billion worth of shares through financial firms including TD Securities and Barclays, opening up so much more liquidity to buy bitcoin.
Saylor told CNBC that it was “probably the most important single earnings call in the company’s history.”
No amount of ownership is too much for Saylor, who predicted in September that bitcoin could reach $13 million by 2045, which would equate to growth of 29% per year.
“We’re going to keep buying prime forever,” he said in the same TV interview in which he compared bitcoin to New York real estate. “Every day is a good day to buy bitcoin. We look at it as cyber-Manhattan.”
Saylor talks enthusiastically about bitcoin as the foundation of a new digital economy that will only grow. But even since his bitcoin strategy launched in 2020, there have been pockets of serious pain for investors — the stock lost 74% of its value in 2022 before rallying over the past two years.
Still, he advises companies to emulate his strategy. Microsoft wasn’t listening, but Saylor said there are plenty of “zombie companies,” with core businesses going nowhere, that could use their money better.
“Traditional advice would be, you make a transformational acquisition, you find you need a merger partner. You’re dead in the water. Find someone to merge with,” Saylor said at Lotte in September. “Bitcoin is a universal merger partner, right? The real appeal of digital capital is that you can fix any company.”
Correction: This article has been updated to correct a reference to the number of years since Microsoft went public.
