BEST SAYLOR SPEECH: BUY BITCOIN NOW (Uncut) 01-27-2025
BEST SAYLOR SPEECH TO UNDERSTAND BITCOIN IN 2025! “BUY IT NOW”
How’s it going everyone, it’s Sam. Michael Saylor just gave a new speech, Bitcoin in 2025. If you’re new to crypto or if you just are interested in seeing Michael Saylor’s thoughts right now on the years ahead and where we’ve come from, you should watch this video.
Put it at 1.5x speed if you need to. I stole this from someone else, not stealing, but I’m recording it from someone else obviously. It is from, let’s see, ICPICR.
So big shout out to them, really appreciate it and yeah, let’s get into it. By the way, if you want to check out our Patreon, it’s sold out. I’ve been saying that it’s going to be sold out for a little while.
It’s sold out at the beginner tier. You can still get in the premium tier. We are looking to add some more spots, but they most likely are going to be at a slightly higher price.
So yeah, you can check that out if you’re interested, but yeah, we are going to open up some more spots later this week at a slightly higher price and you can join them. Also, if you want to trade crypto, there’s a link underneath the video to Blowfin. There’s also a link to Weeks.
We’re in this really interesting pattern. As you can see, we’re in this little ascending triangle right now and you can just see it. We’re getting very tight moves, so it’ll be really interesting to see what happens.
I think we’re probably break in the next few days and it’s not just Bitcoin too. I mean, if you look at a couple different assets, the volatility has calmed down a little bit over the last few days and we’re just yeah, we’re getting much tighter every single day on these moves. So be ready for a big move probably this week.
If you want to trade the move, you can check out the link underneath the video to Weeks and to Blowfin. Thanks for coming. I know I took you away from probably a non-box lunch, but I’ll try to make it worth your while.
Everybody in the world, every investor, every executive is facing an economic and a technology challenge. You could specify the economic challenges. It’s very difficult to outperform monetary inflation when you look at the rate at which the currency supply is expanding.
Most investments don’t outperform it. The S&P 500 is to a certain degree the cost of capital, but all of the safer investment and asset classes underperform. And even though you’re getting wealthy or nominal terms, in real terms you’re really not.
And if you’re a company executive and your company isn’t growing organically 15% a year or more, institutional investors tend to lose interest in you. 15% is a hurdle rate. And when they lose interest, your liquidity and your stock dries up, and then the options market dries up.
And that’s a challenge. In many ways, you could be a zombie company. My company was a zombie company.
We got to the point where the stock traded $2 million a day. There was no options market. We were dead money.
Nobody tuned into our earnings calls, and it wasn’t clear how we were going to get ahead. I would say half of the Russell 2000 are stuck in that same spot, if not 90% of all companies. Here’s one of the reasons why.
The winners in the 21st century, they’re all digital monopolies. If you have an investment portfolio, and it doesn’t include Apple and Amazon or Facebook or Google or NVIDIA, you’re probably not winning. It’s very hard to see how you could be a successful investor without some exposure to those companies.
And if you look at the rest of the S&P, normally the S&P is the 500 greatest companies in the United States. 493 of them are fairly boring. How do you actually compete against a digital monopoly? I think Facebook has 2 billion users a day, or you have a billion customers.
And when you can ship a product to a billion people overnight with a punch of a button, that’s an enormous advantage. All of us, we’re struggling with this issue. How are you going to be a winner when you’re not one of the seven winners? The technology challenge is very intertwined with this, which is you can’t win if you miss the next technology wave.
There was personal computing, and there was the internet, and there was mobile computing, and now there’s artificial intelligence. And I’m here to say that I think everybody in the world understands artificial intelligence is the next technology wave. But I think very, very few people, not so many, really appreciate there’s another technology wave taking place, and it’s a digital transformation of capital.
It’s digital capital. It’s happening right in front of people’s faces, but because it’s unexpected, and it’s a paradigm shift, and it’s an inversion of everyone’s worldview, they tend to dismiss it as something random, unlikely, unlucky, scary. And I’m here to talk about Bitcoin.
And so Bitcoin’s the solution to the problem. It’s the solution to the economic problem. How do you win when there’s only seven companies that can win? And it’s a solution to the technology question.
How do you get on the next technology wave? And how do you exploit it to the benefit of your investors, your family, your company, your customers? Now, how do I know Bitcoin is the next wave? Why should you think it’s the next wave? Well, here’s a chart of the top 10 largest assets in the world right now. And so if you look at the 10, Bitcoin’s number seven. It is the seventh largest asset in the world.
Gold’s number one. Then you’ve got these magnificent seven companies, Nvidia, Apple, Microsoft, Amazon, Alphabet, Meta. And you got Saudi Aramco, and you got a little bit of silver.
But of them, the fastest growing of these is Bitcoin. Bitcoin is growing three times faster than Microsoft. Why is it the next wave? Well, it’s not just the fastest growing asset in the world.
It’s the most popular asset in the world. It’s literally the most popular asset in the world. Everyone wants to talk about it.
It’s the most interesting. It’s the most digital asset in the world. You can’t digitally transform.
You can’t move these other assets at the speed of light a million times a second between 8 billion computers the way you can with Bitcoin. It’s the most useful asset in the world. If you need a billion dollars in five minutes on a Saturday afternoon, this is the only asset you can liquidate.
It is useful to every company on earth, every person on earth. It is global. These other things aren’t global assets with the exception of gold.
In essence, Bitcoin is the digital gold, but you can’t beam gold between 8 billion iPhones. Gold is a 5,000-year-old idea, and Bitcoin is that idea reinvented for the 21st century. Now I’m going to give you a set of suggestions or a set of indicators as to why this is something big, why it’s not just random.
This is Bitcoin versus that asset allocation chart. You can see that it looks hard to find a solution when you don’t include Bitcoin. When you put Bitcoin on the chart, it renders every other solution irrelevant.
It’s pretty clear there’s one thing that’s interesting and everything else is just more of the same. Bitcoin punches a hole into the chart. 60% over the past four years.
If we zoom into that a little bit closer, this is asset performance since MicroStrategy adopted the Bitcoin standard. The S&P is returning 13% a year. Real estate is 10% a year.
Gold is 7% a year. Bonds are minus 5% a year. As you can see, the cost of capital, the hurdle rate there is 13%.
The only thing that’s beating it that’s conventional is the Magnificent 7, which is a bit more than doubling it. And then Bitcoin is doubling the Magnificent 7. One of these things is really an overwhelming winner. Bitcoin more than four times conventional performance.
Let’s look out over 14 years. It’s the winner in 11 of 14 years. So it’s not just it’s up over the last four years, it’s up more over 10 years, 8 years, 12 years.
Here’s another slice. You can look at everything in the world trying to find something which is more compelling, but Bitcoin is showing an annualized performance of 147% from 2011. But again, you know, after Bitcoin, you just fall to like your best growth stock idea.
And it’s not just as the best performing asset, it’s the best performing uncorrelated asset. It’s got the highest Sharpe ratio. It’s also got the lowest correlation.
These are fidelity numbers. So the entire world is looking for an investment idea that’s uncorrelated to risk assets. You know, we have entire conferences, alternative investment conferences.
And we talk about should it be real estate? Should it be natural gas rights? Should it be intellectual property? Well, Bitcoin is the global fungible liquid alternative asset. And you don’t have to believe me or you don’t have to understand the fundamentals. Even if you don’t want to spend a thousand hours studying it, you can just look at the chart published by Fidelity.
It gives you the same answer. BlackRock, they launched a Bitcoin ETF a year ago. That ETF leaped above 1,100 ETFs that they sell to be number 13 in 12 months.
So that just shows you how fast it’s moving, you know, blowing past a thousand other ETFs. But it’s more than that. That ETF is the most successful ETF launch in the history of ETFs.
And I would say if you look at Wall Street over 40 years, the last big innovation in Wall Street was the ETF. The idea that you could buy SPY or you could buy a portfolio, QQQ, or a diversified portfolio of assets. That was the idea, big enough to attract trillions of dollars of capital.
And the most successful example of that big idea is IBIT, which has just been a screaming home run. Not only has it run past nearly all of the BlackRock ETFs and all the other ETFs, it’s actually outstripped BlackRock’s gold fund, which is around forever, IAU, and it did it in 12 months. Digital gold is better than gold.
Just like digital photos are better than physical photos and digital videos are better than your VHS cassettes. It’s not a complicated idea. I digitally transform something, it’s a million times smarter, a million times faster, a million times more ubiquitous, a million times lighter than the thing that it replaced.
In 2024, 10 of the top 20 ETFs launched were all based on Bitcoin. So everybody’s cool idea is based on Bitcoin or some derivative of Bitcoin. Those spot Bitcoin ETFs, they’re compliance gateways or wrappers.
If I want to buy Bitcoin, then I have to solve the compliance problem, the compatibility problem, the convenience problem. In January of 2024, the first ETFs got approved in the US to do this. This is the list of them.
In that 12 months, they siphoned up $109 billion of AUM. So it gives you a sense of just how fast they moved. They were a solution to a problem.
But it’s not just a US phenomenon. ETFs that are backing Bitcoin or are backed by Bitcoin are popping up every country in the world. So you can see they’re in Canada, they’re in Sweden, they’re in Germany, they’re in Singapore, they’re in Switzerland, they’re in Australia.
They solve a fundamental issue. In some cases, it solves the issue of reporting, tax compliance, it may solve the issue of capital controls. You’re seeing ETFs popping up in Hong Kong.
Eventually, the Chinese will let you own Bitcoin, but they’re more likely to let you own it if it’s custodied in a bank in Shanghai. Many countries, they’re not trying to keep their citizens or their companies from getting rich. They’re simply trying to keep the capital from flowing out of the country.
It’s totally fine for a billion people to make an investment that makes them money as long as they keep it in the country in question. These ETFs, in many cases, they’re handles or they’re wrappers, but they’re also just solving the problem of how do you be politically correct and how do you be harmonious with all of the regulators around the world. Wealthy families, they’re always looking for how to diversify their assets.
It’s like, I own a bunch of real estate, or I own a diversified portfolio of stocks, or I want some other alternative assets. Well, there are 60 global billionaires that we know publicly are invested in Bitcoin. I give you a short list, but the more important point is Bitcoin is the fastest growing alternative investment for high net worth individuals in the world.
It’s a very straightforward, powerful idea. I’m going to buy a building. That’s buying property to diversify myself and get away from risk exposure.
That’s great, but buildings are illiquid and they’re not fungible. What if I could buy a digital building and I could buy it $200 at a time or $200 million at a time or $2 billion at a time? What if it offered the same economic property rights, if it offered the same characteristics, whether you bought $200 or $200 million of it? That’s a powerful idea. It’s a fungible idea.
It’s a global idea. It’s an idea people can remember. It’s not likely that you can buy the same physical assets that Elon Musk and Mark Zuckerberg own, but you can buy the same Bitcoin they own and you’ve got the same rights to them.
There are 70 public companies that are capitalizing on Bitcoin right now. You’re starting to see this explode. Companies like Simler, companies like Mara and Riot and Kohler, all of them are realizing that if they recapitalize on Bitcoin, they go from investing in a bond that loses 10% of its value a year to a Bitcoin that gains 40% more value a year.
It’s simply flipping of a light switch. This is a virtuous economic dynamic. It’s spreading virally.
You see 70 companies, then it’ll be 700, then it’ll be 7,000, then it’ll be 70,000. There’s 400 million companies in the world. Who doesn’t want money? Those Bitcoin ETFs are outperforming all the commodity ETFs.
I show you every commodity ETF. What you see is Bitcoin’s crushing everything. Gold is second best.
The rest are just trading vehicles. You can buy some gold and you’ll get an average performance. You can buy Bitcoin and get good performance.
Everything else is just a trade. All other commodities are pretty awful. For more than a few years, you’re not going to invest your family’s life savings in natural gas or soybeans for 100 years.
You can probably figure out why. Those ETFs are also outperforming the bond portfolios. As you can see, if you’re thinking Bitcoin versus bonds, well, bonds are all fairly lame, boring.
Right now, you’re starting to see a movement to 1% to 3% allocation. The 60-40 bond portfolio is going to change. That’s not going to last much longer.
That 1% to 3% allocation of Bitcoin will eventually become a 5% to 10% allocation of Bitcoin. When you start to see conventional portfolios with just 1% to 3% allocation, the price of Bitcoin skyrockets. But when it gets to 5% to 10% allocation, it’s definitely going to be in the millions.
If I put Bitcoin up against every other ETF, what you can see is that it’s still outperforming them all. It’s the fastest horse in the race. You can see where BlockRock’s IBIT sits on the leaderboard right now.
But you can also see that at the rate that it’s growing, IBIT may very well be the largest ETF in the world within 10 years. I would think it’s more likely than not based upon the performance characteristics of the industry. Bitcoin’s beating your favorite hedge fund, right? It is the benchmark.
It was up 121% in the last year. But again, when I look, I’m looking out and I’m saying, well, we’re getting 60% a year from Bitcoin. Show me a hedge fund that’s going to give me 60% a year over four years.
Show me someone that’s going to promise me 30% a year for the next 20 years and not charge me a fee, right? And give me complete liquidity and redemption. It’s not easy. So you see the world’s inverting.
And that takes us to the question of what is Bitcoin? Well, Bitcoin just requires a return to first principles. It’s a new form of technology. It is economic technology.
I think of it as digital energy. But if you started with this trope and you said, what did Satoshi do? Satoshi discovered a method to transfer value without a trusted intermediary. And people oftentimes repeat that, but that’s the small idea.
It’s not the big idea. Yes, we transfer a billion dollars from point A to point B without a bank. The big idea is in order to transfer value without an intermediary, you have to store the value without an intermediary.
The big idea is I put the billion dollars into cyberspace forever. The big idea is we launched a payload into orbit. When you launch a payload into a ballistic trajectory, it comes back to earth.
When you launch it into orbit, it orbits forever. When you get to escape velocity, maybe it’s never coming back. So imagine the idea that I could put a billion dollars into a bank in cyberspace that would stay there, untarnished, not corroding, without being debased, forever.
Forever is such a powerful idea. It’s frictionless. It’s superconducting.
The big idea is store value without an intermediary. It means you transcend banks. You transcend physical laws.
This represents a digital transformation, a capital from financial and physical assets to pure digital. How much does a book weigh if it’s the Encyclopedia Britannica? How much does it weigh when it’s a digital Encyclopedia Britannica? One of them is a billion trillion times lighter than the other. It’s the fundamental phase shift.
What’s that worth? Global wealth is divided across a bunch of assets. Here’s a $900 trillion wealth chart. People own half those things for utility.
They own buildings to live in or work in, and they own cars to drive, and they own companies to operate. But the other half of the assets are just held as a long-term store of capital. You bought it because you had money and you needed to put the money to work.
So you have a land bank, you bought a bunch of land, you bought a bunch of bonds. Half of everything is just long-term capital. If that’s what half of everything is, what’s the problem? The problem is when you put your money, your $450 trillion into that long-term capital investment, you get hit with taxes, income tax.
You get hit with wage controls, price controls, regulations. There’s a fire in California. There’s a hurricane in Florida.
There’s a war in Russia and Ukraine. There’s a currency collapse in Egypt. There’s a bank failure in Lebanon, right? These are all the things that cause you to lose money.
If you’re an investor and you’ve lived long enough, you can probably give me 30, 40, 50 ways you lost money. Most 10Ks have 30, 40 pages of risk factors of just ways you can lose money. There’s a lot of ways you can lose in the world.
I’m going to call it entropy. I’m going to call it chaos. I’m going to call it the passage of time.
Your warehouse just gets older. It was a good warehouse and 40 years later, it’s not a good warehouse. You have to rebuild it.
What’s that cost? That costs about $10 trillion a year. It’s 3% of $450 trillion, right? It’s costing us money to store. I’m going to put a billion dollars in your hands and you got to go buy up everything you want in Asia and hold it 100 years.
Then play all these out and you realize there’s going to be an entropic lapse. There’s going to be an inefficiency there. Well, Bitcoin is an asset without that financial risk of the currency, the stock, or the bonds you’re going to buy.
It doesn’t have the physical risk of real estate or property because you put it in cyberspace. It is in orbit. It is outside of the political domain, outside of the physical domain, outside of a currency domain.
That is a solution to long-term capital. What you see is you see smart money everywhere in the world. Here’s the big idea of Bitcoin.
You get to keep your money. That’s the idea. Who cares? People that live in China and Russia and Africa and South America and Asia and Europe that want to keep their money.
The money is flowing from those long-term capital assets, from that warehouse, from that currency, from that South American bond, from that bar of gold. It’s flowing into Bitcoin. Bitcoin is digital capital.
I would submit to you, I think the greatest digital transformation of the 21st century, more important than digital music or digital books or digital video or digital education or digital fill-in-the-blank, is the digital transformation of capital. Bitcoin is digital capital. If it’s digital capital, it’s going to transform the capital markets.
Imagine your $100 million building. I give you $100 million and you own a building in LA. Okay? Or put it in Miami or put it in any city in the world, in Istanbul.
And now digitally transform it. What happens when you digitally transform the $100 million building? Well, you get rid of all the things that are liabilities. You get rid of the tax, the traffic, the tenants, the torts, the trouble, the weather, the corrosion, the regulator, the fact that you can’t move it.
And then you add all the things that make something more valuable. Right? How do you make the building more valuable? You make it invisible, indestructible, immortal, teleportable, programmable, divisible. You make it fungible, configurable.
You make it volatile. These things make the building more valuable. The other things make the building less valuable.
Bitcoin is, in essence, just that digital transformation. If you had your $100 million building in Ukraine, or you had it in Syria, or you had it in fill in the blank Venezuela, or Cuba, or LA, or you had it in the path of whatever storm, or you had it in Moscow, what’s it worth now? Right? And how does it degrade? Digital capital is global capital, right? This idea of a building, right? It’s like, we can debate whether or not you want your building in New York, or Miami, or LA, or San Francisco. But if I took, if I gave you a billion dollars, and I dropped you in Africa, and I said to you, okay, I want you to go buy a mixture of African assets worth a billion dollars.
Buy anything you want. Buy it in any country. Buy land, buy the buildings, buy the companies, buy your favorite African currency, buy the Egyptian pound, buy the Naira, buy the Krugerrand, buy a concession on a whatever, safari, buy tents, buy mineral rights, buy it all.
The catch is you have to hold it for in Africa. What are you going to buy? And now here’s the second question. Now, they gave you a choice.
You can either buy all that stuff and be locked in that investment for a hundred years, or you can buy digital capital on the Bitcoin network that all the other smart, rich people own. And that you can carry with you in your pocket, or you can zap it out of Africa, and it’s in cyberspace, and it’s not subject to African political jurisdiction, and no warlord in Africa is going to take it. You don’t have to trust an African bank, and you can live in Africa as long as you want until you decide you want to move.
So is it even, I mean, is it even a difficult question? Let me play the question a different way. I’m going to take all your money right now. I’m going to cast a spell, and I’m going to teleport it all, and I’m going to spread it equally across a mixture of market basket of assets in Africa.
And I’m going to say, hey, I played a magic trick on you. I moved all of your assets into the middle of all these countries in Africa. And now I’m going to give you a green button.
You can hit the green button and move it all back. Or I’m going to give you an orange button. You can move it to cyberspace, or you can leave it there.
And so when people wonder, like, why is money flowing into Bitcoin? Why is the price going up? It’s not going up randomly. It’s going up in the same way that water flows downhill, and it’s going in the same way that capital is always fleeing from a less secure situation to a more secure situation, because it’s just a natural human behavior. You have a billion dollars in Nigeria.
You can buy a billion in Bitcoin, but you cannot buy a billion dollars of real estate in New York City, and you cannot put your billion dollars into J.P. Morgan. And so you see on a relative basis, there’s a certain appeal here. And then here we can see Bitcoin is a revolutionary advance in capital preservation.
Everything you own in this world probably has a useful life of 10 to 100 years. So what if I give you something with a useful life of a thousand years? Like when gold inflates at 2% a year, that means it’s got a half-life of 35 years. Your capital in gold has a 35-year half-life.
When something inflates at 0% a year, your capital in that thing has a half-life of forever. The difference between 2% and 0% is I live 35 years. I live for a billion years.
It’s a pretty big difference when you compound it. So this thing we call Bitcoin, it’s a network. It’s secured by energy.
It’s by electrical energy, by computer power, by political power, by economic power. It’s simply put, it’s the most powerful crypto network in the world. It has the most popular support.
It has more computer power than Amazon or Microsoft could muster if they wanted to. People say, what’s it backed by? It’s just backed by power, a lot of power. The political power to topple or tip an election, which is what just happened in the U.S. The computer power that is such a dense hash wall that every computer on earth turned against it wouldn’t dent it.
Let me switch gears to a 21-year outlook of Bitcoin. What do I think is going to happen? Well, I’ve got an open source model. It’s called Bitcoin24.
You can Google it. It’s on GitHub. You can download this.
You can plug in all your assumptions and create your own forecast. But I think looking out over the next 21 years, I think the currency supply will continue to grow. You’re going to continue to see innovation.
You’re going to see equities continue to grow. Gold will gradually underperform. Of course, Bitcoin is going to overperform.
Equities will overperform because of AI and technology. This is a simple view. I put forth in Nashville in July, and I haven’t really changed from it.
I expect that Bitcoin is going to go from 60% ARR decelerating to 20% for a blended rate of 29%. I think the volatility of Bitcoin will go from 60 vol decelerating to 20 vol for a blended vol of whatever, the same. I think that if you look out 20 years, it’s still going to be growing faster than the S&P a bit, 50% more.
It’s still going to be 50% more volatile than the S&P. But you want a simple view of the market. You just think here’s something which is 29% ARR for the next 21 years targeting $13 million a coin.
If you look at that against our map of wealth, it’s not that radically different. Bitcoin becomes the global monetary index, a $280 trillion asset class. Equities will still be bigger.
Real estate will still be bigger. Bonds will still be bigger. If you want to get rich, you’re not getting rich investing in gold.
If you want to stay rich, you can probably hold a diversified portfolio of real estate and equity. If you want to outperform, you’re going to need Bitcoin. We’re entering the era of institutional adoption now.
This 10 years, this is the gold rush era. In 2024, Bitcoin emerged as a viable alternative to bonds and a corporate portfolio. That was the first year.
Now you see all these public entities that are holding Bitcoin, 115 different ones. So this is spreading. As I said, it’s a virus.
It’s going to accelerate. There’s a wave of political support for Bitcoin. It’s surging.
You can see the entire cabinet is pro-Bitcoin. The White House is pro-Bitcoin. The Senate and the House are pro-Bitcoin.
You’ve got a senator proposing a Bitcoin strategic reserve. You’ve got Larry Fink advocating for Bitcoin on CNBC. I just showed you the BlackRock numbers.
They’re stellar. You’ve got Donald Trump. Never sell your Bitcoin.
That’s all you need to know. You’ve got Senator Lummis. I encourage people to buy and hold.
I encourage them to say Bitcoin for their retirement, for their future. You’ve got Joe Carnon debating with Muhammad Al-Aryan. There’s a lot of people that are nodding with you because we can deflate our way out of some of the step, but the difference between 2% and 3% compounded for the dollar is devastating.
I’m saying you should buy Bitcoin. In 2025, we’re the first year of the crypto renaissance. I think what you’re going to see is improvements to the Wall Street ETFs.
You’re going to see fair value accounting from FASB, which will be a big boost. You’ve got 250 plus pro-crypto representatives or senators in Congress. I think you’ll see the repeal of SAB 121, which allows banks to enter the asset class and start to bank Bitcoin.
That’s going to be a big deal. The end of the war in crypto is just a big deal. I think the arrival of a digital assets framework and a bunch of Bitcoin standard companies, all of these things are in the process right now.
A few words on microstrategy. We’re powered by digital capital. What do we do? We flipped to the Bitcoin standard about four years ago.
We started buying Bitcoin and we’ve just been accumulating every quarter. 46, 48 successive announcements. We’re up to 450,000 Bitcoin as of this morning.
What are we doing? What we do is we issue securities, debt securities like convertible bonds or the like, in order to leverage. We raise permanent capital and then we have an equity, which is a bit more volatile and a bit higher performance than Bitcoin. We generate the leverage with fixed income instruments, which are less volatile, lower performance than Bitcoin.
On top of our equity is a very vibrant options market. Then the fixed income instruments offer a different opportunity for fixed income investors. You can think of us as like a Bitcoin refinery.
Crude oil goes in one side and you have kerosene, gasoline coming out the other side. Bitcoin is just crude capital. 60 vol, 60 ARR.
The world’s full of people that want 15 ARR and 10 vol. They don’t want 60-60. We’re just stepping down the Bitcoin and we’re giving people the flavor they want.
What’s happened? We’ve basically almost doubled the performance of Bitcoin, not quite over the last four years. You can see how. The phrase I have and I use often is the only thing better than Bitcoin is more Bitcoin.
You can’t beat 60% ARR. You can’t beat that, except if you borrow money at 0% interest and you buy the 60 ARR, then you can beat it. We borrow money at 0% or 1% interest with convertible bonds, then we buy something going up 60% and that’s how we beat Bitcoin.
You have to have a public company with a large permanent capital base in order to lever it. We’re using our permanent Bitcoin capital in order to issue the fixed income securities in order to create the leverage. That has allowed us to outperform every S&P 500 company over these four years by a large margin.
Of course, part of the trick is to be more volatile. We’re the most volatile company out of the S&P 500. Volatility is thought to be a bug.
We think it’s a feature. Capital is thought to be toxic. We think it’s an asset.
We pursue the volatility. The volatility gives the stock options value and that gives the convertible bonds value. That’s how we’re able to raise capital quickly.
If you look at what volatility has done for us, it’s made us one of the top 10 biggest options markets in the S&P universe. We’re also one of the top 10 most traded names in the S&P universe. The thing on the left is interesting, but the thing on the right kind of tells you the story.
What’s really going on here? We have the largest options open interest as a percentage of market cap in the entire market. We have the highest daily trading volume, the most liquidity as percentage of market cap in the market. Another way to say it is we’re running very hot.
We’ve created a crypto reactor. Bitcoin is the fuel. Conventional wisdom is strip volatility from the balance sheet, strip volatility from the P&L.
But when you do it, you destroy the options market and you destroy your own liquidity. Of course, we are serving as the institutional gateway for you to short Bitcoin or go long Bitcoin with leverage. We’re happy for people to do either.
There have to be two sides to every trade. So you can see we’re about not quite 10 times bigger than the options market for straight Bitcoin. You should power your company with Bitcoin.
This is the speech I gave to Microsoft. I said they should try some Bitcoin. Why? Because it’s the highest performing uncorrelated asset a corporation can hold on its balance sheet.
Microsoft’s 18% a year performance versus Bitcoin’s 62%, bonds minus 5%. Those are the only three numbers you need to see. Now look what happens next.
If you’re Microsoft and you generate a hundred billion in cash flow and you sweep your cash flows into your own stock, you underperform Bitcoin by 97%. You basically lose 97% of your gains because you’re buying a plus 18 instead of a plus 62, right? But look at this one. If you’re Microsoft and you put a hundred billion dollars into U.S. treasury bills, it’s a minus 99.7% trade.
It’s horrific. The bonds are toxic. Now, anybody that went to Harvard Business School knows this, but their solution is the wrong solution.
The solution is surrender all the money. Throw the money away because the money is toxic. Show me a rich family that came up with the idea of throw all the money away to solve their problems, right? If you’re going to perform in a superior way, you’re not going to do it without digital capital.
There’s Microsoft, there’s NVIDIA, that’s MicroStrategy in the same time period. We’re not smarter than them and we don’t work harder than them, right? We’re the people building with steel and they’re building with wood. I have a gun, they have a bow and arrow.
It’s technology, right? Look at MicroStrategy versus Microsoft here. We have effectively the same size options market and our stock trades more than theirs. Why? Because they strip the volatility from the balance sheet and they strip the volatility from the P&L because that’s what Harvard B-School classic finance tells you to do.
What happens when you strip your volatility? You have a 98% collapse in your options market. You have a 99% collapse in liquidity. This is masked by the fact that they’re so large, but this is not good for them.
This is not good for someone holding $10 billion of Microsoft stock. It’s not as good a collateral and it doesn’t generate the same return. This is not what you should be aspiring to.
Every company has a choice to make. Cling to the past, which is conventional. I buy treasury bonds, I do buybacks, I pay out dividends.
Or embrace the future, which is I use Bitcoin as digital capital. A different idea. Bitcoin buys instead of stock buybacks.
The first choice is regression. You’re divesting your earnings yearly, you’re increasing investor risk, and you’re slowing your own growth. The second choice is progression.
You’re investing your earnings back into your own business, as you’re decreasing risk and you’re accelerating growth. This is actually Microsoft in the past five years. They have surrendered $200 billion of capital.
Just surrendered it. They generated $200 billion and how does it help the shareholders today? It doesn’t. It’s gone.
They literally gave it away. And what did they do by giving it away? These are the risk factors in Microsoft’s 10K. Not mine, theirs.
They disclosed them. They’re amplifying their own risk. When you’re buying your stock back, you’re levering up your own equity on your own risk factors.
How do you get out of that vicious cycle? The best way to escape the cycle is to reverse the process and start to invest in a diversified, uncorrelated, highly performing asset. Bitcoin is the asset without counterparty risk. You don’t have risk to a competitor, a country, a corporation, a creditor, a culture, or currency.
That’s the point. Get rid of the risk. What if you could buy a digital monopoly growing at 60% a year at one time’s revenue? And what if that company was more profitable than your own company? Would you do it? Who wouldn’t do it? What if you could keep doing it every year, forever? Well, that’s Bitcoin.
Bitcoin is the universal, perpetual, profitable merger partner. What you’re doing is the transformational merger, but you’re doing it with a crypto monopoly. When you evaluate your options, you can plug in that same model.
I did it for Microsoft. I looked at their business. I looked at their cash flows.
I looked at what happens if they convert their existing assets to Bitcoin, or if they sweep their dividends into Bitcoin, or they replace their buybacks with Bitcoin, or they just borrow a little bit of money cheap to buy Bitcoin. What’s the result? The result is they just convert some of their spare cash. They make $155 a share.
If they replace the dividend, they make $362 a share. They get rid of the buybacks, $477. It’s worth anywhere from $100 to $500 a share.
Do they have to change their core business? Not at all. The other catch is they double the value of the company. What happens to the market cap of the company? Well, status quo is nothing good.
That little change is worth a trillion dollars. If you go to full triple maxi, it’s $5 trillion. You can just be worth $8 trillion instead of $3 trillion or whatever.
What’s the downside? No, you just get rich. This is another way to see Microsoft. 5% of Microsoft’s value is based upon its tangible assets, its actual liquid assets right now.
95% is based upon forward expectations. When you actually start to reinvest in Bitcoin, your stock is valued 41% on your assets and only 59% based on expectations. So conventional wisdom says value the company based on forward expectations, but the richest people in the world aren’t valued based on expectations about how hard they’re going to work.
Bernard Arnault, Jeff Bezos, and Elon Musk, they’re not valued based on how hard they’re going to work. They’re valued based on what they own. Your family’s valued based.
So why wouldn’t you want to own something, right? Bitcoin is the thing to own. So the snapshot here is you can crank the stock price up, improve the ARR, the growth rate for the investors, create trillions of dollars of value. All you have to do is manage your balance sheet differently.
You’re capitalizing on Bitcoin, not capitalizing on bonds. And I’ll just end with some observation. If it’s good for your family and good for your portfolio and good for your company, it’s probably good for your country.
Why not power your country based on Bitcoin? So this is Senator Lummis’ proposal. The idea is to buy some Bitcoin for the United States, actually a million Bitcoin over the course of five years. Why? Because it’s a peaceful, equitable solution for solving political differences.
It’ll actually lay in place a foundation for the U.S. to lead economically and ideologically without violence in the 21st century. It’s because you’re assuming economic and technology leadership in the world. Trillions of dollars of money is going to flow into this network, and you can be the primary beneficiary if you’re the U.S. and you own it.
The U.S. already has the world reserve currency. Why wouldn’t you want to own the world’s reserve capital network? That’s what Bitcoin is, the world’s reserve capital network. And what you’re doing when you support it is you’re attracting the capital from the Chinese, the Russians, the Africans, the South Americans, the Europeans into the network.
All that capital is going to flow and we’re going to be the beneficiaries. If you plug that Bitcoin 24 model in the Lummis bill, what it does is cut the U.S. debt in half over 20 years. But if you think about the precedents, we bought the Louisiana Territory for next to nothing, $15 million, and then we bought California and Mexico and Texas in the Mexican War, and then we bought Alaska.
Look at all those purchases. When we bought Alaska, we bought a bunch of territory not even knowing what it was worth. And then a hundred years later, there’s a trillion dollars of mineral rights underneath it.
They weren’t thinking that in 1867. And so we paid, I think, $40 million for three quarters of the United States. $40 million.
If you know where the people are going, if you know the future, California, what could they possibly do in California? We bought California for $18 million. So Bitcoin is simply cyber Manhattan. All the AIs are going there.
All the global capital is going there. All we need to do is buy it. It’s all going to arrive.
So if you think about the greatest deal of the 21st century, it’s just buy 20-25% of cyberspace. When the U.S. buys it, every company will follow. Every country will follow.
All the capitalists will follow. In the extreme case, the Trump Max case, you make $81 trillion just buying the future. What you’re doing is you’re tipping, you’re inverting the entire world order.
Instead of relying upon 20th century capital assets, that $450 trillion will flow into 21st century digital assets. If you know that the world is moving from the 20th to the 21st century, if you believe in the progression of technology, if you think that people would rather have a billion dollars of Bitcoin than a billion dollars of frozen tundra in Siberia or natural gas rights in Cuba or whatever, then you can just buy it now. You can buy it for next to nothing.
So that’s the logic of the Bitcoin strategic reserve for the United States. It works for any country. It works for any company.
I guess the best thing I can say about Bitcoin is it’s happening. Everybody needs it. Nobody can stop it.
Very few people understand it. It’s just volatile enough to be scary enough that if you don’t do the work and get the conviction, you’ll just stare at it and watch it pass you by. But I don’t really mind the volatility because what I say to people is if Bitcoin appreciated at 60% a year in a perfect exponential with no volatility, people stupider than me, richer than me would own it all and I would have no opportunity.
And so I kind of like the way it’s evolved. And I want to thank everybody for your time today and just leave you with the thought. Do the right thing for your family, for the country, for your investors and adopt Bitcoin.
Now let me know what you think about this underneath the video. I think Michael Saylor’s one of the best people to watch when coming into crypto. And if you’ve been around in crypto, I think he lays out some different thoughts that you probably haven’t thought about.
Let me know your thoughts though. Let me know if you made it this far in the video by, let’s say, telling me your favorite drink. Yeah, let’s go with the favorite drink down below in the comment section.
Again, you can check out the links to Weeks and Blowfin.