WEBVTT - Strategy Executive Chairman Michael Saylor Talks Jim Chanos for Calling to Short Strategy

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>Another success story in terms of the stock that just

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<v Speaker 2>climbs and climbs and climes is Strategy. The company bought

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<v Speaker 2>recently one thousand and forty five more bitcoin, bringing its

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<v Speaker 2>total supply to five hundred and eighty two thousand, worth

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<v Speaker 2>more than sixty billion dollars. Bloomberg News took a look

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<v Speaker 2>at Strategy and it's seventy separate Bitcoin purchases since Michael

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<v Speaker 2>Sailor began to invest cash from the company's balance sheet

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<v Speaker 2>into the token in the middle of twenty twenty, and

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<v Speaker 2>every purchase over the last four years plus is now

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<v Speaker 2>a profitable purchase well.

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<v Speaker 1>And pleased to say that joining us now is Strategy

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<v Speaker 1>Executive Chairman Michael Sailor himself. Michael, it's great to have

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<v Speaker 1>you with us. We have a lot to talk about,

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<v Speaker 1>and one of those things is a recent call from

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<v Speaker 1>Jim Chenos. Of course, he's a legendary short seller. He

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<v Speaker 1>came out recently and said basically, buy bitcoin short Strategy shares,

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<v Speaker 1>and just to set the scene here, I'm curious what

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<v Speaker 1>you make of that.

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<v Speaker 3>You know, I don't think he understands what our business

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<v Speaker 3>model is we're actually the largest issuer of bitcoin back

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<v Speaker 3>credit instruments in the world. So last week we just

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<v Speaker 3>raised a billion dollars by selling a preferred stock non

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<v Speaker 3>cumulative called Stride. That means we basically borrowed money that

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<v Speaker 3>we never have to pay back, that we pay a

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<v Speaker 3>dividend on, but we could suspend the dividend if we

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<v Speaker 3>needed to. So Jim has been thinking that we somehow

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<v Speaker 3>needed to sell the equity. We now are in a

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<v Speaker 3>situation where we have Strike, Stride and Strife, three publicly

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<v Speaker 3>floating preferred stocks that are not deluded to the equity.

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<v Speaker 3>They all meet a different market requirement. Right that one

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<v Speaker 3>hundred and ten million dollars a bitcoin we bought last

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<v Speaker 3>week that was acquired without issuing any common stock. So

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<v Speaker 3>what's going on here is that we're using our sixty

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<v Speaker 3>billion dollars a bitcoin collateral to issue credit instruments. They

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<v Speaker 3>never come due. There's no liquidation risk, there's not even

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<v Speaker 3>an interest rate risk. Right, It's a noncumulative preferred and

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<v Speaker 3>we could suspend the dividends. So at the end of

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<v Speaker 3>the day, if he's lucky enough to short the stock

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<v Speaker 3>below one time's nab we're going to issue the preferreds,

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<v Speaker 3>buy back the stock and make money for our shareholders.

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<v Speaker 3>If the stock trades at a week premium, we're just

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<v Speaker 3>going to sell the preferreds, and if the stock rallies up,

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<v Speaker 3>he's going to get liquidated and wiped out.

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<v Speaker 1>Well, let's talk about that premium, because that is the

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<v Speaker 1>heart of his short call on Strategy, as you point

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<v Speaker 1>out here. So he said recently on a podcast that

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<v Speaker 1>shareholders are paying around two hundred and twenty thousand dollars

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<v Speaker 1>for bitcoin that trades at one hundred and ten thousand dollars.

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<v Speaker 1>But the company is doing everything it can to close

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<v Speaker 1>that spread, which is great, there's a catalyst. So he's

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<v Speaker 1>referring to the fact that you are selling your own

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<v Speaker 1>shares and buying bitcoin. But when it comes to the

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<v Speaker 1>premium that Strategy shares enjoy over the price of bitcoin itself,

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<v Speaker 1>do you think that that's sustainable? The fact that he

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<v Speaker 1>points out that basically you're the value of your company

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<v Speaker 1>is treating at twice that of bitcoin itself.

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<v Speaker 3>What he still doesn't understand is we're not a holding

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<v Speaker 3>company or a closed and trust. We're an operating company.

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<v Speaker 3>So when we issue trust, can't leverage the bitcoin. They

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<v Speaker 3>can't issue preferred shares, they can't issue permanent shares of

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<v Speaker 3>equity out of premium. We can. Our companies generated a

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<v Speaker 3>BTC dollar gain equal to about eight point four billion

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<v Speaker 3>dollars in the first two quarters of this year. That's

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<v Speaker 3>the equivalent of earnings for a bitcoin treasury company. Our

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<v Speaker 3>target for the year is fifteen billion dollars. And so

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<v Speaker 3>he's valuing the business that's generating eight point four billion

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<v Speaker 3>dollars of shareholder of value at zero, and he's hoping

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<v Speaker 3>that somehow the equity will trade to NAB. But what

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<v Speaker 3>he's what he's not paying attention to, is if we

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<v Speaker 3>can issue preferred shares that yield ten percent and invested

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<v Speaker 3>in bitcoin, which has been going up fifty fifty seven

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<v Speaker 3>percent for the past four and a half years, we're

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<v Speaker 3>capturing the forty seven percent arbitrage effectively risk free for

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<v Speaker 3>our common stock shareholders. And if you want to value

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<v Speaker 3>the company, you have to value the company's ability to

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<v Speaker 3>generate bitcoin yield or bitcoin games over and above the

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<v Speaker 3>actual holdings of the bitcoin the company has.

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<v Speaker 2>So, as you said, you have about sixty billion, sixty

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<v Speaker 2>three sixty four billion dollars orth the bitcoin your company

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<v Speaker 2>is worth about twice that at one hundred and six

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<v Speaker 2>hundred and seven billion dollars in market cap, and you

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<v Speaker 2>also have obviously in enterprise analytics software business. How do

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<v Speaker 2>you break down the value of the rest of your

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<v Speaker 2>company x bitcoin holdings.

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<v Speaker 3>If the company generates ten billion dollars of bitcoin gains

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<v Speaker 3>this year, you've got to put a ten or twenty

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<v Speaker 3>multiple on it. Right, So the bitcoin treasury company operation

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<v Speaker 3>is worth a multiple of ten, twenty, thirty or forty

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<v Speaker 3>times the BTC yield we're generating. That's the number one

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<v Speaker 3>source of value for the operating business. And then the

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<v Speaker 3>company also has sixty billion dollars plus worth of bitcoin,

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<v Speaker 3>and I would I would say to investors look at

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<v Speaker 3>it that way. A BTC dollar gain is like our

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<v Speaker 3>earnings equivalent, and then the bitcoin nav is the assets

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<v Speaker 3>on the balance sheet, and you should just look at

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<v Speaker 3>the earnings equivalent and put the multiple do you think

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<v Speaker 3>is appropriate on it. To come to an opinion about

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<v Speaker 3>the value of entire enterprise.

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<v Speaker 2>Michael Nobody has to explain the rapid rise and bitcoin

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<v Speaker 2>to me. I started buying bitcoins at eight hundred dollars.

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<v Speaker 2>I bought one as low as six hundred, but I

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<v Speaker 2>spent them. Unfortunately, How how do you expect the asset

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<v Speaker 2>to continue a price increase at these levels that we've seen,

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<v Speaker 2>I mean, can it keep that up over the next

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<v Speaker 2>five years, over the next ten years? And at what

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<v Speaker 2>point do we see, you know, winter coming again? Because

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<v Speaker 2>that's been a permanent fixture of this asset class. Right,

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<v Speaker 2>It's gone from zero or ony to twenty and then

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<v Speaker 2>back down to three or four, and then up to fifty,

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<v Speaker 2>and then back down to fifteen and now up to

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<v Speaker 2>one ten, Like, when does it drop again?

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<v Speaker 3>Winter is not coming back. We're past that. We're past

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<v Speaker 3>that phase. If bitcoin's not going to zero, it's going

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<v Speaker 3>to a million dollars, and you have all the evidence

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<v Speaker 3>you need to determine that. Right. The President of the

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<v Speaker 3>United States is determined he supports bitcoin, The Cabinet supports bitcoin.

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<v Speaker 3>Scott Peasant supports bitcoin. Paul Atkins has shown himself to

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<v Speaker 3>be an enthusiastic believer of bitcoin and digital assets. Ken

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<v Speaker 3>Tez a CFTC feels the same ray the banks are

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<v Speaker 3>going to custody bitcoin. Bitcoin has gotten through its riskiest period,

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<v Speaker 3>the accounting has been corrected. There's now only four or

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<v Speaker 3>fifty bitcoin a day available for sale by natural sellers,

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<v Speaker 3>that's the miners. At this level, that works out to

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<v Speaker 3>about fifty million dollars a bitcoin available for sale every day.

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<v Speaker 3>If that fifty million dollars is spot, then the price

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<v Speaker 3>has got to move up to find any natural any

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<v Speaker 3>seller that's priced sensitive. Now, if you do the math,

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<v Speaker 3>you'll actually see the Bitcoin Treasury companies by themselves or

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<v Speaker 3>buying the entire natural supply. Black Rock and the ETFs

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<v Speaker 3>are buying another measure of that. And we've got nation

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<v Speaker 3>state actors coming into the space. So I think when

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<v Speaker 3>bitcoin rallies, if it surges to five hundred thousand or

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<v Speaker 3>a million dollars, then maybe we could talk about it

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<v Speaker 3>crashing down by two hundred thousand dollars a coin. But

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<v Speaker 3>at the current price levels, it only takes fifty million

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<v Speaker 3>dollars to turn the entire drive shaft of the crypto

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<v Speaker 3>economy one turn, and you've got the Trump Media Organization

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<v Speaker 3>announcing two and a half billion, you've got Game Stop

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<v Speaker 3>announcing five hundred million, You've got my company that's raising

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<v Speaker 3>billions and billions of dollars. So the writing is on

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<v Speaker 3>the wall. Bitcoin's moving higher.

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<v Speaker 1>Okay, so there's a few things to dig into there.

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<v Speaker 1>One that, in your words, Bitcoin Winter is not coming back.

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<v Speaker 1>I'm rereading Game of Thrones right now, so that statement

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<v Speaker 1>gives me the shivers. But I did want to go

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<v Speaker 1>to the competitive landscape if you can freeze it that way,

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<v Speaker 1>and you went there, naturally, you think about the ets

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<v Speaker 1>suites out there. Bit for example, already up to seventy

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<v Speaker 1>two billion dollars in assets. There's a lot of bitcoin

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<v Speaker 1>treasury companies that have come to the scene, as you mentioned.

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<v Speaker 1>Twenty one Capital comes to mind, started by Jack Mallers,

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<v Speaker 1>and they all have the intention of just accumulating bitcoin.

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<v Speaker 1>That would be good for the price. Michael, as you say,

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<v Speaker 1>but do you worry about the competition out there to

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<v Speaker 1>buy bitcoin? It's going to become more and more expensive,

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<v Speaker 1>and everyone's competing for a shrinking pie, if you will.

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<v Speaker 3>I think we're in a digital gold rush, and you've

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<v Speaker 3>got ten years to acquire all your bitcoin before there's

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<v Speaker 3>no bitcoin left for you. The competition is a virtuous competition.

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<v Speaker 3>Metaplanet's the hottest company in Japan right now. They went

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<v Speaker 3>from ten million to a billion dollar market cap to

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<v Speaker 3>a five billion dollar market cap. They're going to raise

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<v Speaker 3>billions of dollars. They're going they're going to pull the

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<v Speaker 3>liquidity out of the Japanese market, so they'll be right

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<v Speaker 3>in capital and Tokyo and the Tokyo Stock Exchange. Obviously,

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<v Speaker 3>none of the rest of us are trading or selling

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<v Speaker 3>equity in the Tokyo Stock Exchange, so it's not competitive,

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<v Speaker 3>it's cooperative. There are companies coming public in Brazil right now,

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<v Speaker 3>like Orange BTC that'll come public in some timeframe and Meluse.

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<v Speaker 3>They're actually supporting equity capital markets in Brazil. You know,

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<v Speaker 3>the game stops. They already had six billion dollars a

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<v Speaker 3>capital and so for them to start to take some

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<v Speaker 3>of that capital and funnel into bitcoin, it's good for

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<v Speaker 3>all of us. Knakamoto in twenty one, they'll bring their

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<v Speaker 3>own particular twist. Our company is a very particular business model.

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<v Speaker 3>It's to issue bitcoin back credit instruments like bitcoin back

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<v Speaker 3>bonds and especially bitcoin back preferred stocks. We're the only

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<v Speaker 3>company in the world that's ever been able to issue

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<v Speaker 3>a preferred stock back by bitcoin. We've done three of

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<v Speaker 3>them in the past five months. We're not competing against

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<v Speaker 3>the bitcoin treasury companies. We're competing against ETFs like PFF

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<v Speaker 3>that have portfolios of preferred stocks or corporate bond portfolios

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<v Speaker 3>that are trading as ETFs in the public market, and

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<v Speaker 3>the way we compete is we offer foreigner basis points

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<v Speaker 3>more yield on an instrument that is much more heavily

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<v Speaker 3>collateralized and more transparent. And that's we're not going to

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<v Speaker 3>saturate that market anytime soon. That's one hundred trillion dollars

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<v Speaker 3>or more of capital in those markets.

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<v Speaker 2>It sounds like, you know, when you talk about what

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<v Speaker 2>you're doing in terms of financial engineering in terms of

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<v Speaker 2>financial markets with bitcoin, clearly it's I mean, you're doing

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<v Speaker 2>a lot more than just holding the bitcoin. So it's

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<v Speaker 2>I think unfair to compare you to an ETF, But

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<v Speaker 2>it sounds like you may be inviting competition from a

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<v Speaker 2>JP Morgan for example, which then makes me wonder, when

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<v Speaker 2>does this asset start to convince the naysayers? You know,

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<v Speaker 2>Jamie Diamond has famously said it's worthless, Warren Buffett has

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<v Speaker 2>called it probably rat poison squared. When when does it

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<v Speaker 2>win those people over?

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<v Speaker 3>People called the electricity worthless and aircraft worthless too when

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<v Speaker 3>they didn't understand them. So I welcome the competition from

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<v Speaker 3>JP Morgan, I hope to enter the space. Our advantage

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<v Speaker 3>is that we're one hundred percent bitcoin, so whenever we

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<v Speaker 3>create a preferred stock, it has the Bitcoin performance, and

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<v Speaker 3>it has a measure of Bitcoin performance and a fraction

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<v Speaker 3>of Bitcoin volatility. That allows us to issue the most

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<v Speaker 3>liquid preferred stocks in the world. The highest performance Strike

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<v Speaker 3>was up twenty nine percent when the rest of the

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<v Speaker 3>market of preferregs was down six percent. Strife was up

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<v Speaker 3>twenty two percent when the rest of the market was

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<v Speaker 3>down four point six percent. It's impossible to issue bitcoin

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<v Speaker 3>backed convertible preferreds and bitcoin backed fixed preferreds unless you're

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<v Speaker 3>willing to make one hundred percent of your balance sheet bitcoin.

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<v Speaker 3>So I'm not really worried about competition from JP Morgan

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<v Speaker 3>or Berkshire Hathway. I would love for them to enter

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<v Speaker 3>the bitcoin space buy up a bunch of bitcoin. When

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<v Speaker 3>they do it, they'll be paying a million dollars a bitcoin.

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<v Speaker 3>The price will go to the moon. That will be

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<v Speaker 3>good for the entire crypto economy and beneficial to everyone

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<v Speaker 3>that holds any BTC backed equity or credit based instrument.

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<v Speaker 1>Well, I'm still thinking about you saying that you view

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<v Speaker 1>yourself in competition, not with the bitcoin treasury companies, but

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<v Speaker 1>with some of the ETFs that hold preferred shares, that

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<v Speaker 1>that is the strategy that they're tracking. And when it

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<v Speaker 1>comes to your own financing and the fact that you

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<v Speaker 1>have been pivoting to issue more preferred stocks to fund

0:13:51.640 --> 0:13:55.800
<v Speaker 1>your purchases, why is that? Why go towards preferreds rather

0:13:55.880 --> 0:13:58.760
<v Speaker 1>than convertible bonds? Is it just a question of demand

0:13:58.840 --> 0:14:00.559
<v Speaker 1>or is there something to it?

0:14:02.280 --> 0:14:06.760
<v Speaker 3>The convertible bond market normally is a short duration investor.

0:14:07.000 --> 0:14:09.360
<v Speaker 3>They want to hold the bond three or four years,

0:14:09.640 --> 0:14:12.160
<v Speaker 3>and the calls that are embedded in the bonds are

0:14:12.200 --> 0:14:14.680
<v Speaker 3>capped calls capped at one hundred and thirty percent of

0:14:14.720 --> 0:14:19.440
<v Speaker 3>the strike and sorry of the conversion price. And so

0:14:20.280 --> 0:14:24.600
<v Speaker 3>that's a short duration call investor and a short duration

0:14:24.840 --> 0:14:30.640
<v Speaker 3>credit investor. What we sold with Strike SDRK was a

0:14:30.680 --> 0:14:34.400
<v Speaker 3>perpetual call option good for one hundred years or forever.

0:14:34.840 --> 0:14:37.520
<v Speaker 3>And then we sold a perpetual dividend you could hold

0:14:37.520 --> 0:14:40.240
<v Speaker 3>for one hundred years and give to your grandkids. So

0:14:40.480 --> 0:14:46.480
<v Speaker 3>long duration credit, long duration call, and that preferred never

0:14:46.560 --> 0:14:50.240
<v Speaker 3>comes due for us, so we don't have liquidation risk.

0:14:50.360 --> 0:14:53.440
<v Speaker 3>We don't have credit risk, So it's a much better

0:14:53.560 --> 0:14:56.800
<v Speaker 3>instrument if you intend to invest in a volatile asset

0:14:56.920 --> 0:15:00.280
<v Speaker 3>like bitcoin and hold the investment forever. Now, the other

0:15:00.360 --> 0:15:04.160
<v Speaker 3>point I'll make, Katie, is if you think about what

0:15:04.200 --> 0:15:08.760
<v Speaker 3>we're competing against. There's like eighty billion dollars worth of

0:15:08.840 --> 0:15:14.640
<v Speaker 3>corporate credit and preferred equity based ETFs that we identified.

0:15:15.200 --> 0:15:17.600
<v Speaker 3>Most of them charge a fee of fifty to eighty

0:15:17.640 --> 0:15:21.600
<v Speaker 3>basis points a year, most of them generate a yield

0:15:21.640 --> 0:15:25.080
<v Speaker 3>of six or seven percent, and most of them have

0:15:25.280 --> 0:15:30.160
<v Speaker 3>very heterogeneous o PAI credit, low volatility, and very low liquidity.

0:15:30.840 --> 0:15:35.400
<v Speaker 3>We're offering preferred instruments that have eight to ten percent

0:15:35.920 --> 0:15:42.080
<v Speaker 3>dividend yields at par ten to one hundred x higher liquidity.

0:15:42.160 --> 0:15:47.880
<v Speaker 3>They trade really really hard, very very liquid, and their

0:15:47.920 --> 0:15:53.320
<v Speaker 3>homogeneous credit and they're six x over collateralized. So it's

0:15:53.320 --> 0:15:57.680
<v Speaker 3>a very compelling instrument if you believe in bitcoin as

0:15:57.720 --> 0:16:00.240
<v Speaker 3>a digital assets.

0:16:00.240 --> 0:16:02.680
<v Speaker 1>To finish the thought here, and I'm looking at invescos

0:16:02.720 --> 0:16:06.440
<v Speaker 1>preferred ETF. The ticker there is pg X that charges

0:16:06.520 --> 0:16:09.520
<v Speaker 1>in expense ratio of fifty one basis points. It has

0:16:09.560 --> 0:16:12.360
<v Speaker 1>about four billion dollars in assets. When you say that

0:16:12.360 --> 0:16:14.880
<v Speaker 1>you're in competition with funds such as this one. Are

0:16:14.920 --> 0:16:18.800
<v Speaker 1>you referring to the fact that you're competing for investor

0:16:18.880 --> 0:16:21.520
<v Speaker 1>attention with these ETFs? I just want to make sure

0:16:21.560 --> 0:16:22.800
<v Speaker 1>I'm understanding your point.

0:16:22.920 --> 0:16:25.120
<v Speaker 3>Yeah. What I'm saying is you go buy that, maybe

0:16:25.160 --> 0:16:28.280
<v Speaker 3>you get seven percent yield effectively, and you pay the

0:16:28.320 --> 0:16:32.239
<v Speaker 3>fifty basis points, and some of that is QDI eligible,

0:16:32.280 --> 0:16:35.520
<v Speaker 3>and some of that is taxable. When you buy one

0:16:35.560 --> 0:16:39.480
<v Speaker 3>of our preferreds, like Stride is yielding like eleven percent

0:16:39.600 --> 0:16:42.760
<v Speaker 3>pluss right now, and Strife is yielding nine nine and

0:16:42.760 --> 0:16:46.680
<v Speaker 3>a half percent, you buy that, it's all QDI eligible.

0:16:47.000 --> 0:16:52.560
<v Speaker 3>It's it's trading ten to fifty times more liquid on

0:16:52.640 --> 0:16:57.040
<v Speaker 3>a dollar for dollar basis. It's very homogeneous credit and

0:16:57.080 --> 0:17:01.280
<v Speaker 3>you get an extra foreigner basis points of yield, better

0:17:01.360 --> 0:17:05.800
<v Speaker 3>tax treatment, et cetera. So we're actually competing against that.

0:17:05.880 --> 0:17:12.720
<v Speaker 3>We're offering tax efficient, zero fee fixed income yield to

0:17:12.840 --> 0:17:15.119
<v Speaker 3>someone that wants to hold that in their portfolio.

0:17:16.119 --> 0:17:19.560
<v Speaker 2>Michael, I would at least in the top five most

0:17:19.600 --> 0:17:22.840
<v Speaker 2>important characteristics of bitcoin is its security, right, I mean,

0:17:22.880 --> 0:17:26.199
<v Speaker 2>scarcity has to be one near the top. And the

0:17:26.280 --> 0:17:30.480
<v Speaker 2>Ledger obviously was a genius move by Satoshi, but it

0:17:30.520 --> 0:17:33.840
<v Speaker 2>seems to be uncrackable, and I'm wondering if that will

0:17:33.840 --> 0:17:37.480
<v Speaker 2>hold true far into the future with the development of

0:17:37.520 --> 0:17:39.600
<v Speaker 2>quantum computing. Do you worry about that?

0:17:41.560 --> 0:17:44.320
<v Speaker 3>I don't worry about it, And I make the point.

0:17:45.000 --> 0:17:48.679
<v Speaker 3>You know, Microsoft and Google market their quantum projects, but

0:17:48.760 --> 0:17:51.960
<v Speaker 3>they would never sell a quantum computer that cracked cryptography

0:17:51.960 --> 0:17:55.760
<v Speaker 3>because it would destroy their own companies. And there isn't

0:17:55.800 --> 0:17:59.640
<v Speaker 3>a practical use case for those quantum projects they've been marketing.

0:18:00.280 --> 0:18:03.360
<v Speaker 3>I think at some point a decade out, maybe ten

0:18:03.440 --> 0:18:07.399
<v Speaker 3>twenty years, maybe whenever, there'll be a powerful computer it

0:18:07.480 --> 0:18:11.120
<v Speaker 3>may start to threaten modern cryptography. When it does it,

0:18:11.119 --> 0:18:14.320
<v Speaker 3>it'll be a threat to Microsoft, Google, JP Morgan, the

0:18:14.440 --> 0:18:18.160
<v Speaker 3>US government. It may be a threat to bitcoin. When

0:18:18.200 --> 0:18:21.199
<v Speaker 3>it is a threat, all of these organizations are going

0:18:21.280 --> 0:18:26.520
<v Speaker 3>to upgrade their crypto protocols to be quantum resistant. You'll

0:18:26.560 --> 0:18:30.480
<v Speaker 3>see it coming a mile away. And every other digital

0:18:30.640 --> 0:18:34.280
<v Speaker 3>entity in the world is more vulnerable to that idea

0:18:34.480 --> 0:18:37.080
<v Speaker 3>or that threat than Bitcoin, and so they're all going

0:18:37.119 --> 0:18:39.440
<v Speaker 3>to upgrade, and we'll be talking about it while you're

0:18:39.440 --> 0:18:43.560
<v Speaker 3>reviewing Microsoft stock or Apple stock exposure.

0:18:44.280 --> 0:18:47.200
<v Speaker 2>I only I don't want to go too deep into this, Michael,

0:18:47.200 --> 0:18:50.639
<v Speaker 2>because it's only a half hour program. But I feel

0:18:50.680 --> 0:18:53.960
<v Speaker 2>like AI could You know, everyone's worried that AI may

0:18:54.000 --> 0:18:55.720
<v Speaker 2>turn on us, and this could be a way in

0:18:55.760 --> 0:19:00.280
<v Speaker 2>which AI has real power. Is that not the thing

0:19:00.280 --> 0:19:01.840
<v Speaker 2>that keeps you up at night.

0:19:03.160 --> 0:19:05.800
<v Speaker 3>I'll make a point here. The typical person might do

0:19:05.880 --> 0:19:09.680
<v Speaker 3>ten thousand transactions in their lifetime, maybe one hundred thousand

0:19:09.720 --> 0:19:12.480
<v Speaker 3>if they're very busy. The AIS are going to do

0:19:12.560 --> 0:19:17.080
<v Speaker 3>one hundred thousand transactions of minutes. They're not going to

0:19:17.640 --> 0:19:21.680
<v Speaker 3>suffer the existing credit systems, in the existing banking systems

0:19:21.680 --> 0:19:24.480
<v Speaker 3>of the twentieth century. They're going to want to move

0:19:24.520 --> 0:19:27.640
<v Speaker 3>digital money at high frequency, at the speed of light.

0:19:28.440 --> 0:19:32.080
<v Speaker 3>That means digital assets like bitcoin over the Lightning network

0:19:32.640 --> 0:19:38.280
<v Speaker 3>or via Layer three protocols. The demand for digital capital

0:19:38.840 --> 0:19:42.840
<v Speaker 3>which is what bitcoin is, and digital networks like Lightning,

0:19:42.960 --> 0:19:45.320
<v Speaker 3>and like all of the crypto protocols that are being

0:19:45.320 --> 0:19:47.920
<v Speaker 3>worked on right now, it's going to go through the roof.

0:19:48.400 --> 0:19:51.879
<v Speaker 3>So I think AI is really a demand driver for bitcoin.

0:19:52.040 --> 0:19:56.520
<v Speaker 3>It's going to accelerate the entire digital assets economy. And no,

0:19:57.200 --> 0:20:00.439
<v Speaker 3>I'm not worried about the threat the AIS can't crack

0:20:01.040 --> 0:20:04.840
<v Speaker 3>public private key cryptography. What they can do is imitate

0:20:04.880 --> 0:20:08.080
<v Speaker 3>you and talk you into doing something stupid if you're

0:20:08.240 --> 0:20:10.280
<v Speaker 3>listening to them. And so they are a threat to

0:20:10.320 --> 0:20:13.119
<v Speaker 3>all the other systems in the world, not to Bitcoin.

0:20:13.640 --> 0:20:15.360
<v Speaker 1>All right, Michael, we got to leave it there. It's

0:20:15.400 --> 0:20:18.159
<v Speaker 1>always great to speak with you appreciate the time that is.

0:20:18.200 --> 0:20:21.280
<v Speaker 1>Strategy co founder and executive chairman, Michael Saylor