MSTR Explained (Reverse Repo Of Bitcoin) 30k+ Target
Updated
A lot of people are critizing MSTR & Michael Saylor for his Bitcoin activity and it needs to be cleared up on how serious this is for MSTR.
If Bitcoin continues on its trajectory, MSTR will be in the top 10 companies by market cap in the SP500.
1. Spot ETF's cannot be added to SP500 Index funds.
2. Spot ETF's cannot be levered on the base price.
3. MSTR shortly will be in the SP500 index funds meaning global allocation to the standard funds will be buying up MSTR shares that MSTR in return will be using to buy Bitcoin and apply low corporate leverage debt.
SP500 Index Fund > MSTR > Debt/Bitcoin > Bitcoin scarcity increased > Spot ETF rises, increasing the MSTR total value.
Large funds can park money with MSTR that MSTR then uses extremely low corporate leverage to accumulate more Bitcoin per capital invested that they then hold and adjust shares accordingly / buy back shares.
At the end of this bull market Michael Saylor can also make a decision to get debt against a portion of his Bitcoin in the company balance sheet and use his operating income / to fund and secure the debt.
Spot ETF's are extremely important including Futures.
MSTR? also very important in what he is doing.
MSTR is not a Spot ETF it's a company with a structure to generate returns like Berkshire Hathaway, there is risk involved but Saylor has taken a route that gives MSTR a strong resilience to bear markets and stronger upside to bull markets. This might have not worked if there was too much Bitcoin supply to purchase meaning Spot ETF's out weigh MSTR.
But MSTR has more than enough for what it needs to become one of the largest investment company in the world.
MSTR on this trajectory is worth north of $20,000 per share.
Note
Monitoring this as of today there is still a large hedge fund trapped with Si (Short Interest) on MSTR roughly 17.65% of outstanding shares.This is barely dropped since the gapping of the MSTR price between $448-$1,246 putting the cover cost somewhere between $1-3B depending of their source of collateral.
It's clear to me that they have to either buy MSTR Shares + Call Options or fire sale another asset to get out of this situation, personally I think if they wanted to exit they would have already done so seeing the Spot ETF Inflows on BTC, Someone is stuck.
Note
MSTR Currently Rank +299Note
MSTR Currently Rank 283 ^7*notes* people seem to be having a disconnect thinking the total value of MSTR's market cap is equal the spot Bitcoin they have. This is not how market caps work.
Note
MSTR Currently Rank 278Current Short Interest Cover has grown to
$5,925,000,000
Might need to bust out that "Fubar" phrase as I don't think Bitcoiners look to be selling any MSTR shares.
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