1 year ago
During the MicroStrategy (MSTR) Q3 net call, Executive Chairman Michael Saylor said Bitcoin is winning, successful crook boosting the company’s fortunes.
“Bitcoin is winning, but MicroStrategy is winning adjacent much than the Bitcoin close present due to the fact that of our levered agelong Bitcoin strategy we pursued.”
MicroStrategy is the biggest nationalist institution holder of Bitcoin, astatine 130,000 tokens, with a marketplace worth of $2.655 cardinal based connected today’s price.
Since archetypal announcing its BTC strategy successful 2020, the steadfast has travel nether occurrence with critics saying its BTC-heavy attack puts shareholders astatine hazard and forms a distraction from the company’s halfway bundle business.
Despite that, the merchandise of the Q3 net study saw MicroStrategy banal emergence 3%. However, MSTR remains down 51% year-to-date. Similarly, Bitcoin is down 56% year-to-date.
Bitcoin outperforms different plus classes
During the call, possibly to dispel criticisms of the company’s concern strategy, Saylor focused connected the clip play since archetypal adding Bitcoin arsenic a treasury asset.
He said since Aug. 11, 2020, MSTR has “outperformed each of the large plus classes that we benchmark ourselves against.” Later adding that these benchmarks see each large tech and endeavor bundle stocks.
“You tin spot from this chart, we are up arsenic of 4:00 P.M. yesterday, October 31 we were up 116%, since we embarked connected this strategy.”
Likewise, helium pointed retired that Bitcoin is up 72% since August 2020. Whereas the S&P and Nasdaq grew 15% and 0%, respectively, implicit the aforesaid period,
As acold arsenic golden is concerned, Saylor said golden is down 19%, which, successful retrospect, justified MicroStrategy’s determination to spell BTC-heavy implicit the precious metallic to sphere wealthiness during the precarious macro conditions.
“Gold is the hard wealth solution for the 19th century, and Bitcoin is the hard monetary plus for the 21st century.”
Impairment charges
Based connected accounting standards that necessitate “indefinite-lived intangible asset,” specified arsenic Bitcoin, to beryllium recorded astatine impaired worth without consequent unrealized gains to beryllium reflected, MicroStrategy’s integer assets bash not bespeak marketplace value.
The quality is made up of impairment charges. Given Bitcoin’s comparative stableness during Q3, this quarter’s BTC impairment complaint came successful astatine $700,000, the lowest since adopting BTC arsenic a treasury asset.
CFO Andrew Kang said the acquisition of an further 301 BTC this 4th reaffirms the company’s committedness to its treasury strategy.
In addition, Kang besides referenced ongoing discussions with the Financial Accounting Standards Board implicit changing the attraction of Bitcoin to a “fair valuation” standard, which recognizes consequent gains pursuing impairment losses.
Kang said the adoption of a just worth accounting attraction modular would promote further organization adoption.
“If yet adopted and implemented, we judge just worth accounting volition improve upon the current, unfavorable intangible accounting attraction applicable to bitcoin holdings and volition beforehand further institutional adoption of bitcoin arsenic an plus class.”
The station Saylor says ‘Bitcoin is winning,’ deems golden a 19th period solution arsenic MicroStrategy outperforms large plus classes appeared archetypal connected CryptoSlate.
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