Tuesday, December 24, 2024

MSTR Failure Market Impact

I’m aware of the general business model that MSTR uses to create leverage through debt to purchase Bitcoin and those gains are reflected in the share price. Clearly the volatility is significant based on the underlying assets combined with the structure.

As a person who assigns very little actual value to cryptocurrency I am wondering if the failure of MSTR can be the market event that triggers a larger equity sell off as well as retrace crypto back to a much lower level. I’m not saying crypto is completely worthless but these forward valuations are unhinged from reality.

A correction is much needed and this firm really feels like a Ponzi Scheme. I’m curious how much Bitcoin would have to fall to cause this firm to unwind or if this expected dilution they are planning could in turn cause a large sell off.

No one can speak with certainty on the future but I have a hard time believing a clown like Saylor is going to be a visionary and his firm is much more likely to be an Enron.


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