Michael Saylor Reacts To Bitcoin & Crypto Crash

Michael Saylor Reacts To Bitcoin & Crypto Crash

For example, if you’d asked the same question to Jeff Bezos in 2003 and said you just had an 80 loss in Amazon. So, you ever wish you sold amazon in the year 2001? Jeff Bezos could have sold Amazon in the year 2000 and avoided a 95 percent loss. Do you wish he did that’s true but you see how foolish that is right? For example, Mark Zuckerberg could have also sold Facebook just before or just after the IPO and avoided a 50 loss. And in fact, Jeff Bezos could have sold Amazon five different times and avoided an 80 loss. If he’d sold at any one of those five times, he wouldn’t be one of the richest people in the world. So, I think that trying to time the market is a traitor mentality. 

But if you look at all the richest people in the world, they’re not traitors. I mean Bill Gates, Steve Ballmer, Jeff Bezos, Elon Musk, Mark Zuckerberg, Larry Page, name the person that traded their way to that situation. You can’t really do it like trying to time, the market is ridiculous. If you look at statistical analysis of bitcoin or the S P, I think the conclusion generally is that like eighty percent of your returns come in one percent of the days. So, if you miss the top three days of a year, you might lose 80 percent of your return. If you miss the top six days, you lose it all. So, the way this is going to work.

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Is it’s going to look like you’re not making a lot of money? 98 of the time and then you’re going to wake up one day and you’re going to find out the sovereign wealth fund of some Middle Eastern country just bought 10 billion dollars a bitcoin. It’s going to double or it’s going to triple and then you’re going to be kicking yourself and screaming saying: well, I could have bought it at blank and I didn’t buy. It at blank and you’ll be angry. I think that trading mentality is just really an awful mentality for anyone. If you’re not running proprietary algorithms on high-speed computers, like I get it, if you’re a high-speed computer trader and you’re like slicing a tenth of a penny a billion times an hour, like I get that, that kind of trading. But for 98 of the population, people don’t have any proprietary edge to trade. So, generally they all get beat by the market trading people want to invest in something that they understand, that they can trust. So, if you’re going to be a theme park company that’s what you should do. If you’re going to be a movie company, if you’re going to be an oil company, you should be a pure-play. You should focus you know in a laser-like way on that because that allows a rational investor to put you in their portfolio, for example. Maybe you hate Bitcoin, if microstrategy has a strategy which is – we’re long bitcoin, we’re leveraged long bitcoin. Then that’s good right because now. You can short us, it’s not a bad thing for people to short your stock because if they short your stock. Eventually, they’re going to have to cover right there. It’s not a PR.

On the other hand, maybe, they like bitcoin. But they think, it’s 99 likely to fail. Think about it. You have 100 million dollars, so you put one percent of your portfolio in it and to find someone that actually is pure long bitcoin. You see, so if we’re transparent and predictable, then we allow a rational investor to allocate their portfolio. They just don’t want us to be unpredictable. What happens if we become unpredictable? If I’m predictable, you might meet with me. Understand, what I’m going to do and say. I wanted to put five percent of my portfolio into bitcoin and you might actually invest five million dollars after a one-hour meeting right. But if you met with me and I said I’m a genius and I can trade everything. I know when to sell and when to buy and… I’m gonna time the market and I have all these algorithms you’re like.

Well, maybe you do maybe you don’t but 95 of the time those things don’t work and the point is i have just you know if you’re the investor you want to hedge the risk. You don’t want the management team to hedge the risk. I’m a black box, so after you meet with someone that says they’ve got some wacky complicated trading algorithm instead of investing five million dollars. You invest zero and you study it for 500 hours.

Let me put it a different way. You could probably raise a billion dollars in one day, if you’re predictable even from people that don’t even like bitcoin whereas if you’re unpredictable. You could work for a thousand days and raise nothing the world wants certainty it wants clarity and conviction. It wants you to execute with focus, so it happens that we believe in bitcoin. But there are plenty of people that trade our stock. You could buy our stock and go along with our stock and short bitcoin. You see this crash is gonna cause a lot of clarity to form there first. The community is getting educated right. I bet you everybody in the crypto community today knows the difference between a dollar in the bank and UST. I bet you they have an intelligent conversation about the difference between circle and UST and the business model of the two. We saw last week Tether had to redeem billions and billions of dollars of Tether.

They could, right? But if you had actually tried to redeem seven billion dollars of UST in a couple of days, well, people tried to do that and they couldn’t. So, I think the industry got educated. But also I think that there’s a lot of people that would like to issue stable coins like Caitlyn long’s bank would like to issue stable coins. If you look at the banks like Silvergate and Signature, they’re FDIC-insured banks but they can’t issue stable coins. nd if you look at JP Morgan and Goldman Sachs and Citigroup. 

They can’t issue stable coin now, if you roll the clock back six months the president’s working group put out a Memo on stable coins and when they put out the Memo they said we’d like for FDIC institutions to issue stable coin. Now putting aside whether you agree with that or not um there’s been a regulatory deadlock on capitol hill. I think that most regulation is going to create turmoil for the 19 500 cryptos. There’s gonna be a shakeout, so regulation generally is good for bitcoin and it’s a and it’s difficult for the rest of the cryptos right they’re on the opposite side, but there are it is possible to construct a very profitable crypto exchange, and a very profitable cryptocurrency a stable coin business and a very profitable set of crypto securities with regulation. It’s just that’s going to be a lot more work, I think that generally just about all regulation that’s contemplated anywhere in the western world is going to accelerate mainstream adoption of bitcoin should get 10x bigger and then 100x bigger. The thing holding it back is the fact that, there’s no regulatory clarity in the crypto industry, so I’m not really concerned about the regulation.

This article is a transcription of a video made by Jamie Tree

Original video: https://youtu.be/EaUyi18Xopg