Anyone who believes that it ends with investing for perceived future profits as Bitcoin's value continues to appreciate has no clue what it means when institutions pull money into specific assets or industries.
These guys have to be ready to have long-term skin in the game to even begin this journey, there's no exit strategy because the goal isn't set on direct profits through sell offs.
That would just be stupid.
How much profit do you think Microstrategy would earn if it began selling bitcoin when literally all eyes would be on them? and how would that affect their position, generally, in the investment markets?
The only strategic exit that works is the one that does not involve selling the principal or underlying asset, and with Bitcoin, we are effectively looking at building a banking system around the base collateral held on-chain.
So….
Custodianship + Multi-level banking solutions; Welcome to the new Central Economic Bank
You might think I'm reaching with this, but there's a good reason why I trust this theory to be a close enough endgame play with Saylor.
Anyone who pays a great deal of attention to how the world works knows that there's no business that beats banking, when it comes to profit.
Just ask Tether and question why stablecoins regulation is intensifying.
Everything you do goes through the bank, at the end of the day and they, through the central powerhouse, control the direction of the economy and the value of your outputs.
So why run a dying software company when you can pivot to a banking system backed by an asset powered by mathematical tech?
The average person looks at Bitcoin and says, cool, 21 million supply, scarcity, not scalable, bla bla bla.
Well, make no mistake, it is true that Bitcoin isn't built to be scalable, but those flaws disappears almost instantly when you consider the fractionalized form of bitcoin which essentially stretches it's supply to 2.1 quadrillion or 2,100,000,000,000,000, in literal numbers, which is appropriately 4.6x larger than the current estimate value of the total wealth in the world if we consider 1 Satoshi to be = $1.
The big question here of course is if that will ever happen? And if it does, what does that mean for Microstrategy?
The first question, I cannot give an answer to, that's left for the market to decide, but regardless of if it does get to $1 per sat or not, the outcome for Microstrategy at any price point upwards is that it allows the institution to build what I call a Bitcoin Bank(Bitbank), where off-chain currencies users transact with are backed by Bitcoin.
These currencies could be called “Micro Bitcoins” and the fun part is that they could be far more expandable, to a point where the supply could essentially exceed the known 2.1 quadrillion Satoshi.
How?
That's just fractional reserve banking baby. Microstrategy can print as much bitcoin so long as new deposits keep showing up. It's the beauty of off-chain transactions, it's not marked to original.
With Microstrategy holding an asset with a known market cycle trend, it can essentially issue loans that are two times larger than any average bank can, simply for holding Bitcoins on-chain as the insurance asset.
With more coming through the system, Microstrategy’s held Bitcoins can also theoretically trade higher than every other Bitcoin out there.
It's just a matter of if they want to build and run it that way. With a little branding here and there, people are going to willingly transact off-chain through an asset insured by Bitcoin, but vastly expandable, like any regular fiat as the institution grows in adoption.