The MicroStrategy mystery: Is this a pyramid scheme?
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The markets, year-to-date
S&P 500: 5,686.67 ⬇️ -3.3%
FTSE 100: 8,596.35 ⬆️ 4%
Bitcoin: $96,201.71 ⬆️ 2.9%
GBP to USD: $1.3274 ⬆️ 6%
GBP to EUR: €1.1744 ⬇️ -2.9%
(As of Friday market close.)
MicroStrategy: The greatest unsolved mystery in the stock market right now
Back in February we introduced you to MicroStrategy which calls itself a “Bitcoin treasury company” because it devotes itself almost entirely to buying and holding Bitcoin.
MicroStrategy (which recently rechristened itself “Strategy”) holds 553,555 Bitcoins, which at a value of $96,000 each are currently worth just over $53 billion. The company’s market cap (the total value of all its stock), however, is $107 billion — twice the value of its Bitcoin holdings.
MicroStrategy gets the money for all this Bitcoin by selling new stock or offering bonds that convert into new stock at a later date. Every time it does th…