Can anybody here explain to me what is the purpose of MSTR if the MNAV premium disappears? If the NAV premium disappears they can no longer productively issue shares and If they are just issuing debt instruments paying 8 - 12% interest to buy Bitcoin you can just IBIT shares then get a margin loan against it and pay 6 - 10% interest (and buy more BTC with the money) which is less than what MSTR is paying.
They made it for the video.
How are they increasing BTC yield currently? This is the answer.
Care to elaborate on how you think it works and why my analysis is wrong?
First off, it's a trade, I've always said that. It's just a long term (10 year) trade that will be emotionally difficult, too much so, for most.
Second, they can get NAV from time delays with STRC offerings, and their other offerings. The hurdle rate will provide.
MSTR works just fine with an MNAV of 1…they still increase share value by buying more bitcoin. Buying 1 bitcoin worth of MSTR will grow over time, in bitcoin terms. It’s practically the only investment that does. Selling common shares is only 1 of 5 ways to raise capital to buy bitcoin. Selling preferred stock is more accretive to shareholders in most cases, unless mnav is high.
IBIT margin loan might accomplish the same thing, but Strategy does not want to buy IBIT shares, they want to have their own bitcoin and come up with their own products. I don’t think you can do margin loans in certain accounts like 401k/403b/IRA either.
The other advantage of the preferred stocks: they never come due — there is no principal to repay and no debt on the balance sheet.
Paying 10% interest to buy an asset that is appreciating 50% is still a good buy. The total addressable market for STRC is insanely huge… tens of trillions. As long as fiat exists, MSTR will be able to increase bitcoin per share.
I think in time, STRC or something like it is how bitcoin will recapitalize fiat. Keeping a cash balance in STRC instead of CDs, money markets, or other short term cash equivalents, will change the entire system. It’s a product the entire world is starving for…STRC is the real “stablecoin” in that it is essentially a way to maintain value through fiat debasement but without the volatility of bitcoin.
MSTR is like an oil refinery for BTC. Insurance companies, pensions, banks: can’t tolerate the volatility of straight BTC. Strategy removes some of the volatility of BTC for different use cases :
STRC, STRE: short term
STRF, STRD, STRK: long term
They are building a bitcoin yield curve, stripping some or all of bitcoin’s volatility, and making financial products that have a big market.
I believe the safest place for money is in BTC…but if you have enough BTC and still want to invest — the only investment that can increase in BTC value is MSTR. Investments have more risk than money, that’s why they have returns. MSTR has more risk than BTC, but it also can provide a return, measured in BTC.
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Got me thinking more about how to explain Strategy’s strategy…prerequisite is understanding BTC, but many bitcoiners do not understand it either.
Let me do a little thought experiment.
A rich dude, maybe Hugo Stinnes’ https://jimrickards.blogspot.com/2015/02/warren-buffett-and-hugo-stinnes.html younger brother, Kurt…
converts all of his company’s paper marks into gold bullion.
The government money is inflating at 10%…people notice, but don’t understand what is happening. Prices seem to be going up — maybe it’s greed? Hoarding? The general public does not really understand that inflation is NOT rising prices, it is the collapse in the value of the money they are using.
Kurt’s company’s value, (mainly a vault stacked with gold bullion) measured in paper marks, is increasing rapidly. His company has almost no debt, and a balance sheet assets (gold) more valuable than most insurance companies, but with far lower expenses and far fewer employees. Interest rates paid by banks and bonds in the market are about half the rate of money creation — even people who risk their money loaning it to banks or the government are losing it to negative real rates (financial repression.)
Kurt wants his company to increase its wealth…and make more money for shareholders. He borrows money by going into debt at first, by issuing bonds. He is able to buy more gold with this strategy but there is a limitation. Every time he takes on more debt, his balance sheet of assets is impaired by the increasing debt, making it harder to borrow more at favorable rates. The bonds come due eventually, and must be paid at par. If he has to sell some of the gold in a few years, it will be less than he added by selling the bonds, but it would be better for shareholders if he never had to sell any of it.
If he issues shares of common stock, and the share price is higher than the fractional portion of gold it represents, it will add more gold without adding debt. But again there is a limitation. Once he has so much gold that he has to add hundreds of tons of it at a time, he has to sell a lot of stock value for little return in the percentage increase of gold per share of common stock.
So another idea comes into being. He can issue his own money, backed by the gold. People bring their paper marks, he immediately buys gold with it and puts it in the vault, and he issues them Kurt marks. Kurt marks hold value over months and years…1 Kurt mark buys a loaf of bread in 1924 just as well as it did in 1921. More and more people get rid of paper marks and buy Kurt marks. The more people that do, the more gold the company buys. The more gold the company buys with paper marks, the more the paper mark depreciates against gold.
People start pulling their money from government bonds, banks, CDs and other parts of the paper mark financial system. The only way to keep customers is to raise the interest paid in the bank and for bonds, but they can’t afford to do that unless they print even more paper marks too keep banks and the government solvent. Inflation rate increases, and even more people hear about the Kurt mark and how it holds its value month to month, year over year. Insurance companies start to realize that the premiums paid by customers in previous years and saved in government bonds, have lost so much value that they cannot meet their obligations, because things are now much more expensive in paper marks.
Insurance and other funds that have long term obligations start selling off their government bonds and buying Kurt marks because they hold value over time. When customers pay them premiums over 10 years, they will be able to pay for a new house when it burns down, even though it is 4x as much in paper marks, it it the same price in Kurt marks.
Let me do a little thought experiment.
A rich dude, maybe Hugo Stinnes’ https://jimrickards.blogspot.com/2015/02/warren-buffett-and-hugo-stinnes.html younger brother, Kurt…
converts all of his company’s paper marks into gold bullion.
The government money is inflating at 10%…people notice, but don’t understand what is happening. Prices seem to be going up — maybe it’s greed? Hoarding? The general public does not really understand that inflation is NOT rising prices, it is the collapse in the value of the money they are using.
Kurt’s company’s value, (mainly a vault stacked with gold bullion) measured in paper marks, is increasing rapidly. His company has almost no debt, and a balance sheet assets (gold) more valuable than most insurance companies, but with far lower expenses and far fewer employees. Interest rates paid by banks and bonds in the market are about half the rate of money creation — even people who risk their money loaning it to banks or the government are losing it to negative real rates (financial repression.)
Kurt wants his company to increase its wealth…and make more money for shareholders. He borrows money by going into debt at first, by issuing bonds. He is able to buy more gold with this strategy but there is a limitation. Every time he takes on more debt, his balance sheet of assets is impaired by the increasing debt, making it harder to borrow more at favorable rates. The bonds come due eventually, and must be paid at par. If he has to sell some of the gold in a few years, it will be less than he added by selling the bonds, but it would be better for shareholders if he never had to sell any of it.
If he issues shares of common stock, and the share price is higher than the fractional portion of gold it represents, it will add more gold without adding debt. But again there is a limitation. Once he has so much gold that he has to add hundreds of tons of it at a time, he has to sell a lot of stock value for little return in the percentage increase of gold per share of common stock.
So another idea comes into being. He can issue his own money, backed by the gold. People bring their paper marks, he immediately buys gold with it and puts it in the vault, and he issues them Kurt marks. Kurt marks hold value over months and years…1 Kurt mark buys a loaf of bread in 1924 just as well as it did in 1921. More and more people get rid of paper marks and buy Kurt marks. The more people that do, the more gold the company buys. The more gold the company buys with paper marks, the more the paper mark depreciates against gold.
People start pulling their money from government bonds, banks, CDs and other parts of the paper mark financial system. The only way to keep customers is to raise the interest paid in the bank and for bonds, but they can’t afford to do that unless they print even more paper marks too keep banks and the government solvent. Inflation rate increases, and even more people hear about the Kurt mark and how it holds its value month to month, year over year. Insurance companies start to realize that the premiums paid by customers in previous years and saved in government bonds, have lost so much value that they cannot meet their obligations, because things are now much more expensive in paper marks.
Insurance and other funds that have long term obligations start selling off their government bonds and buying Kurt marks because they hold value over time. When customers pay them premiums over 10 years, they will be able to pay for a new house when it burns down, even though it is 4x as much in paper marks, it it the same price in Kurt marks.
If you are living in 1921 and can’t see the end of the chart, gold marks vs paper marks looks like:
You missed it.
It’s too volatile.
Only when it’s over and the dust settles years (or decades) later do you realize that bitcoin is not a hedge; it’s a replacement.
You missed it.
It’s too volatile.
Only when it’s over and the dust settles years (or decades) later do you realize that bitcoin is not a hedge; it’s a replacement.
I sold a lot of my mstr because I had great conviction that approaching the shutdown, and in league with the 7k S&P channel top, we'd get big time selling, and we did. There are a few other reasons why I did it, some personal, but also that the bear rally should have happened by now, Cowen and Colin called it with sober analysis, and the 50 week MA never was overcome at its trendline. In my view, we're going to $74k, if I had to guess. With the clarity act that never came, and the need for liquidity and Trump F'ing around with tariffs, and the Iran bombing desire, I'm more than fine waiting until after April to re-buy, which I will. Buy the way, I never sell hodl'd BTC
I'm also not selling the BTC HPC data mining (energy) stocks that I have.
Everything's a rug pull now. Retail BTC investors don't have the capital necessary to make a profit off of 2% or 3% fluctuations in the price of BTC and that's all that is happening now. Widespread adoption of and regulation of crypto with regards to the involvement of traditional financial institutions has had the opposite affect on crypto currencies than many analysts had predicted. For crypto's, (BTC in particular) to have any meaningful bull market again will take a catalyst that none of us see's coming yet.
A lot of old coins selling into $100k, that was a huge milestone. More percentage of old coins sold into that wall than at any other time.
BTC will have its day. Gold is 10x bigger than BTC and had a 5x in as many years...so I don't think bitcoin is too big to to have a 5x bull run too.
It's coming. Don't ask me how I know, since you won't believe me anyway.
Gold just admitted it will vomit it all back. They will see.
February 17th, 2024:
Not even close Clostradamous. The BTC all time high was 126K on October 26th, 2025. Once again, you are way off. And even worse, as of today the price sits at a paultry 79K, not anywhere near your predictions of 150K and 200K+.
November 14th, 2025:
And wrong again.
January 29th, 2026:
If you had to "guess"? "74K," you say? Why not 75K? An even "74," eh? What if you had to be right (for once)? How many times can a man call for 150K and then readjust that by half at 74K before he admits he really has no idea what's he's talking about, much less what is really going on?
The jews who invented Bitcoin and completely rigged it against you and then psy-oped you into believing it is rig-proof, have really got you over a barrel on this one don't (((They)))?
And then you have the audacity to question and ridicule my understanding about the (((Financial System)))...
The balls on this guy, am I right?
Not even close Clostradamous. The BTC all time high was 126K on October 26th, 2025. Once again, you are way off. And even worse, as of today the price sits at a paultry 79K, not anywhere near your predictions of 150K and 200K+.
November 14th, 2025:
And wrong again.
January 29th, 2026:
If you had to "guess"? "74K," you say? Why not 75K? An even "74," eh? What if you had to be right (for once)? How many times can a man call for 150K and then readjust that by half at 74K before he admits he really has no idea what's he's talking about, much less what is really going on?
The jews who invented Bitcoin and completely rigged it against you and then psy-oped you into believing it is rig-proof, have really got you over a barrel on this one don't (((They)))?
And then you have the audacity to question and ridicule my understanding about the (((Financial System)))...
The balls on this guy, am I right?
Problem with Bitcoin is that now it just attracts people trying to get rich quick by finding another guy to buy it at a higher price.
I always wanted some price stability or linear progression. What I fear is people not interested in Bitcoin anymore because price is not going up anymore and creating a domino effect.
I agree with PurpleUrkel. I always find it funny predictions. It’s like pricing; from $342,798.54 to just $79.99! People take numbers out of who knows where.
I always wanted some price stability or linear progression. What I fear is people not interested in Bitcoin anymore because price is not going up anymore and creating a domino effect.
I agree with PurpleUrkel. I always find it funny predictions. It’s like pricing; from $342,798.54 to just $79.99! People take numbers out of who knows where.