WEBVTT - Strategy Executive Chairman Michael Saylor Talks Crypto

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news. Let's keep this conversation

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<v Speaker 1>on crypto going because so called digital asset treasury firms

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<v Speaker 1>have announced plans to raise a combined seventy nine billion

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<v Speaker 1>dollars so far in twenty twenty five just for bitcoin purchases,

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<v Speaker 1>according to advisory firm Architect Partners. But that trend is

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<v Speaker 1>expanding into smaller tokens as well. And I'm pleased to

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<v Speaker 1>say that joining us now is Strategy Executive Chairman Michael Sailor. So, Michael,

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<v Speaker 1>it feels like, of course, MicroStrategy strategy as it's now known,

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<v Speaker 1>really started this crypto treasury company trend that we're seeing now.

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<v Speaker 1>I know that you broadly are supportive of seeing that,

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<v Speaker 1>seeing competitors come out and also raise their own crypto treasuries.

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<v Speaker 1>But how do you feel about the trend that now

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<v Speaker 1>it's moving more into alt coins, it's moving away from bitcoin.

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<v Speaker 1>Do you think that that's a sustainable setup now?

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<v Speaker 2>I still think the vast majority of the capitol flowing

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<v Speaker 2>in the space is flowing into bitcoin. We've gone from

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<v Speaker 2>about sixty companies capitalizing on bitcoin to one hundred and

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<v Speaker 2>sixty companies just in the past six months, So I'm

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<v Speaker 2>laser like focused on bitcoin. I think bitcoin is digital capital.

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<v Speaker 2>I think it's going to outperform the S and P

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<v Speaker 2>Index over the indefinite future. And I think it's the

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<v Speaker 2>clear global monetary commodity in the world right now. So

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<v Speaker 2>it's the lowest risk, highest return, most straightforward strategy if

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<v Speaker 2>you want to outperform the S and P and if

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<v Speaker 2>you want to inject vitality and performance into your balance sheet.

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<v Speaker 1>So it sounds like you're not concerned that perhaps the

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<v Speaker 1>fact that we're seeing these other digital asset treasury companies

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<v Speaker 1>come to the four here expand into all coins, You're

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<v Speaker 1>not concerned that that's going to detract attention away from

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<v Speaker 1>what strategy is doing.

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<v Speaker 2>You know, I think there's an explosion of innovation across

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<v Speaker 2>the entire crypto economy, and on the margin, it's really

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<v Speaker 2>good for everybody in the digital asset space right now.

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<v Speaker 2>I think the big idea is one hundred trillion dollars

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<v Speaker 2>plus of capital and the traditional equity capital markets and

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<v Speaker 2>traditional credit markets, and what we're focused on is delivering

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<v Speaker 2>digital asset backed equity and digital asset backed credit. And

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<v Speaker 2>I think those credit instruments and equity instruments are just

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<v Speaker 2>going to outperform the traditional fiat credit and traditional fiat

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<v Speaker 2>equity instruments all around, and capital is going to flow

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<v Speaker 2>into the digital economy due to that.

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<v Speaker 3>Michael, explain the assets, the unique assets to which you

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<v Speaker 3>offer investors access, because it's not just you know, bitcoin

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<v Speaker 3>treasury company, you have, you think, a unique selling point

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<v Speaker 3>compared to other others trying that strategy.

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<v Speaker 2>Yeah, the real compelling idea of a bitcoin treasury company

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<v Speaker 2>is we hold a huge stock of bitcoin, about seventy

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<v Speaker 2>four billion dollars worth of bitcoin. Bitcoin's a twenty one

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<v Speaker 2>year duration asset. You got to hold it for twenty

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<v Speaker 2>one years if you want the full potential, and it's

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<v Speaker 2>about fifty boll and fifty aoar. Most people don't want

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<v Speaker 2>that amount of volatility, even though it's got that performance,

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<v Speaker 2>and who wants to wagh twenty one years? So what

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<v Speaker 2>we've done is we've created structured bitcoin in the form

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<v Speaker 2>of strike STRK. We give you the bitcoin upside, a

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<v Speaker 2>guarantee dividend and principal protection, and that's an alternative for

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<v Speaker 2>people that don't want the roller coaster. We've created a

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<v Speaker 2>long duration senior credit instrument called STRIFE. Think of it

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<v Speaker 2>as a twenty one year bitcoin back bond pays about

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<v Speaker 2>eight and a half percent dividend yield right now for

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<v Speaker 2>people to just want that quarterly dividend yield and a

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<v Speaker 2>seniority in the capital structure. And then you've got a

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<v Speaker 2>high yield, long duration instrument called STRIFE. It's actually paying

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<v Speaker 2>like eleven and a half percent divid in yield right now,

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<v Speaker 2>and so that's for people that want high yield forever

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<v Speaker 2>and they'd rather have eleven percent quarterly than take that's guaranteed.

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<v Speaker 2>Then the roller coaster a bitcoin. And then the most

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<v Speaker 2>exciting thing we've done just a few weeks ago. It's

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<v Speaker 2>the biggest IPO of the year. It's called Stretch STRC,

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<v Speaker 2>and STRC is like a monthly bitcoin backed bill, and

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<v Speaker 2>so think of it as a bitcoin alternative to treasury

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<v Speaker 2>bills or money market funds. It's nine percent divid in

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<v Speaker 2>yield monthly cash pay and if you just want to

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<v Speaker 2>park short term cash and get paid nine percent dividends

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<v Speaker 2>and have it powered by bitcoin, you're not taking duration

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<v Speaker 2>risk on the interest rate, you're not taking the bitcoin volatility.

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<v Speaker 2>And that's our most successful offering to date.

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<v Speaker 1>Well, Michael, I do want to talk a little bit

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<v Speaker 1>more about your financing. You touched on it a lione

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<v Speaker 1>little bit. One of the other trends that you've started

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<v Speaker 1>is issuing convertible notes to fund your bitcoin purchases. You've

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<v Speaker 1>also been issuing preferred stock as well. When it comes

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<v Speaker 1>to just straight micro strategy shares, we know that it's

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<v Speaker 1>very popular with retail. We know convertible notes have been

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<v Speaker 1>popular with more of the Wall Street crowd. Do you

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<v Speaker 1>have any insight on who the end buyer of your

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<v Speaker 1>preferred stock is?

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<v Speaker 2>Well, right now, we've had really extraordinary demand from retail

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<v Speaker 2>are in our last offering. I mean we started with

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<v Speaker 2>about thirty or forty million of retail demand on the

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<v Speaker 2>first preferred, and then it increased the sixty million on

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<v Speaker 2>the second preferred, and then one hundred and twenty million

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<v Speaker 2>on the third preferred, and about six hundred million on

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<v Speaker 2>the fourth preferred, So retails off the charts. We've also

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<v Speaker 2>got a lot of institutional long investors people that are

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<v Speaker 2>holding it. Look, if you like bitcoin or if you

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<v Speaker 2>like mstr these are all pretty compelling for any pol

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<v Speaker 2>A capital you've got. And then of course a bunch

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<v Speaker 2>of hedge funds also got very excited about this. There's

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<v Speaker 2>lots of different ways to trade these against each other,

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<v Speaker 2>so a good mixture of institutional as well as retail

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<v Speaker 2>investors buying into all these preferreds.

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<v Speaker 1>And Michael, I'd also love to get your thoughts on

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<v Speaker 1>some of the other big news from today. A lot

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<v Speaker 1>has certainly happened on this Friday, but one of those

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<v Speaker 1>is what's going on in the gold market right now.

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<v Speaker 1>You have the Trump administration ruling that gold bars will

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<v Speaker 1>be subject to tariffs as well, these reciprocal tariffs, so

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<v Speaker 1>imports of gold will be tariffed, and that's really sending

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<v Speaker 1>shockwaves through the gold ecosystem. Gold and bitcoin are often

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<v Speaker 1>compared to one enough of their bitcoin called digital gold,

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<v Speaker 1>for example. I wonder if you think this has any

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<v Speaker 1>ripple effects positive or negative for bitcoin.

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<v Speaker 2>It does. Bitcoin is digital gold. That's going to accelerate

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<v Speaker 2>the migration of capital from physical gold to digital gold.

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<v Speaker 2>You know, bitcoin lives in cyber space, no tariffs in

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<v Speaker 2>cyber space. The big appeal of bitcoin is it's not physical,

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<v Speaker 2>it doesn't have weight. You can settle anywhere with anybody

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<v Speaker 2>in a few minutes. And so gold has always been

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<v Speaker 2>too heavy, too slow, you know, and you can't really

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<v Speaker 2>ship it across an ocean, and if you do now

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<v Speaker 2>you're getting terriffs. So I really think it just reminds

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<v Speaker 2>everybody why the digital version of gold is better than

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<v Speaker 2>than actual physical gold. And I think it's going to

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<v Speaker 2>catalyze a new wave of institutional adoption of bitcoin.

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<v Speaker 1>All right, Crypto is stateless. It's hard to tear if

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<v Speaker 1>Michael have to leave it. They're really enjoyed speaking with

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<v Speaker 1>you though. That is Strategy Executive Chairman Michael Saylor