Latest / Simply Bitcoin / Michael Saylor Predicts $400T Bitcoin After Buying $1B in a Single Day! | Bitcoin Simply

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Michael Saylor Predicts $400T Bitcoin After Buying $1B in a Single Day! | Bitcoin Simply · Simply Bitcoin

0:00
Did Sailor just predict $400 trillion Bitcoin?
0:03
Yeah, And strategy just pulled off something that I don't think
0:06
anybody saw coming. They raised and purchased $1
0:09
billion worth of Bitcoin in just one week.
0:12
If you extrapolate that out, that means they will buy five
0:14
times more than all of the Bitcoin mined this year.
0:17
And yesterday's shareholders had something to say about that
0:20
chump change. Yesterday they had $1.1 billion
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in volume alone. Sailor might have just issued
0:26
the supply shock that shorts didn't see coming.
0:28
MicroStrategy is just 8 days away from surpassing BlackRock
0:31
as the largest Bitcoin holder in the world.
0:34
In an interview with Bankless, Sailor breaks down the strategy
0:37
behind Stretch and why it's the Trojan horse making Bitcoin the
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global reserve currency of the world while no one was paying
0:43
attention. He predicts why Bitcoin becomes
0:45
a $400 trillion asset over the next 20 years, why we're going
0:49
to be much higher the rest of the year, and why Stretch is the
0:52
biggest revolution in finance. We got a lot to cover.
0:55
This is Dante Coke with Bitcoin. Simply, let's go.
1:01
All right, let's get into it. Bitcoin is on a tear right now,
1:05
smashing through 737475K like it's nothing.
1:09
Peter Schiff is in tears right now, and it's because strategy
1:12
is buying five times the amount of Bitcoin being mined every
1:15
single week. And Michael Saylor says this is
1:17
just the beginning. Where do you believe the price
1:20
of Bitcoin will go? Well, you know, I think it's
1:24
going up like I've, I've said I've got a 21 year view and my
1:28
21 year view is that over the course of 21 years it's going to
1:32
average about 29% ARR. It's it's going to decelerate,
1:38
has been growing a bit faster and it will decelerate to grow a
1:42
bit slower. I think the past five years it's
1:45
like a 37% annualized growth rate.
1:48
So if it, if it, you know, moves from 37% down to 20%, you'll get
1:53
some blended rate, you'll get a blended volatility.
1:56
And I, you know, I think where are we right now?
2:01
I think it's oversold. So I would expect that Bitcoin
2:03
will be much higher by the end of the year.
2:06
Higher, yes, but how much higher?
2:08
OK. So at that level of growth like
2:10
the 20 year time horizon, what, what price does that get us to
2:14
for Bitcoin? Oh, I think eventually it's
2:17
going to 20,000,021 million a coin. 21 million a coin.
2:21
OK. So what's that like a market cap
2:23
of like 400 trillion, something like this 400 trillion?
2:28
I think it's going to emerge as the dominant digital capital of
2:32
the world. If you want to know why Bitcoin
2:34
is ripping, 2 words Supply Squeeze.
2:36
Yesterday Strategy bought $1 billion worth of Bitcoin funded
2:40
all through Stretch 0 dilution to shareholders.
2:43
Just a week ago, their purchase was 75% stretch and 25% issued
2:48
through MicroStrategy shares. This week they acquired 13,927
2:52
Bitcoin with preferred stock cash.
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Here's what this means in practice.
2:56
Strategy built a Bitcoin acquisition machine that works
2:59
without touching the equity of common shareholders.
3:02
Strategy pays an 11 half percent dividend, doesn't convert that
3:05
to shares and fixed income. Investors are happy because it's
3:08
higher than any comparable bond yield that they can get in the
3:10
market. The stretch investor gets yield,
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MicroStrategy gets more Bitcoin per share.
3:15
Everybody wins. This is creating the supply
3:17
shock of all supply shocks. Like 2-3 weeks ago we saw $1.2
3:21
billion of it. When we saw $1.2 billion of
3:25
STRC, we buy $1.2 billion of Bitcoin, and that week we bought
3:30
5 Bitcoin for every Bitcoin mined or something like some
3:33
insane amount. If we sell $10 billion of
3:37
stretch in a year, we're going to buy the entire supply mined
3:41
by the miners. When we sell 20 billion, we'll
3:44
buy 2 two extra supply. So the formation of those
3:48
digital credit networks will facilitate a huge amount of
3:51
capital flowing into the system. Right now, Bitcoin adds about
3:54
450 new coins a day, 164,000 coins a year.
3:58
That's roughly $11 billion of supply at A70K price stretch
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just did that amount of volume in a single day strategy used
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that to buy over 10,000 Bitcoin 13,927, which is more than what
4:10
miners produce every single day. This is the supply squeeze.
4:13
If you extrapolate that out, 365 billion in a a single year, I
4:17
know it's not going to sustain that kind of volume.
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What you see is millions of coins being purchased against a
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shrinking supply of Bitcoin. This is what a structural supply
4:25
shock looks like. But Sailor told us he was going
4:28
to do this and nobody paid attention.
4:30
We're not stopping for those people that we have buyer
4:34
fatigue. We don't have buyer fatigue.
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I think that we can buy more Bitcoin than the sellers can
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sell and we're going to take it all and and we're going to take
4:46
it out of circulation. Stretches introduced a 0
4:48
volatility way for people to accumulate yield and for
4:51
strategy to accumulate Bitcoin. That wins for everybody, but
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there's also an amazing tax benefit that nobody is talking
4:59
about. Here's what a return on capital
5:01
investment looks like. That the real brilliance of the
5:04
business model is you're acquiring a capital asset that
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you're holding in perpetuity and you're never realizing the
5:12
capital gain on it. If you pay the dividend by
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remitting the unrealized capital gain back to the credit
5:21
investor, the dividend becomes a return of capital dividend,
5:25
which means it is also tax deferred.
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So the the basic principle is I'm entering into a capital
5:34
investment that I expect to hold in perpetuity and I'm paying a
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dividend on the unrealized capital gains through issuing A
5:42
derivative instrument that allows the credit investor to
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collect dividends for a decade tax deferred.
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And should they die and pass that credit instrument to their
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heir, they get a step up in the basis.
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So you could be a retiree, collect dividends for 10 years,
6:00
not pay tax, pass it through to your heir, they get a step up
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and they get 10 years of dividends that are also tax
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deferred. So the thing that makes the
6:09
entire structure work is that you're making a capital
6:14
investment for a credit investor and you're absorbing the
6:19
uncertainty of the future and the volatility of the present on
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the balance sheet of the common equity in order to strip the
6:27
risk and strip the volatility from the credit investors
6:32
portfolio. And the credit investor is
6:36
paying you handsome, handsome, handsomely for that, right?
6:40
And everybody's getting what they want, right?
6:43
The capital investors in Bitcoin get a benefit, the equity
6:47
investors and strategy get amplification of Bitcoin and the
6:52
credit investor gets that stripped down.
6:56
Low volatility digital, you know, instrument digital yield
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instrument. Hold on, I don't think people
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understand what he means when he says tax deferred.
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This is Bitcoin simply, so I'm going to break it down for you.
7:08
Most high yield stuff pays you taxable income every single
7:11
year, which stretch that 11:00-ish percent is classified
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as return on capital. This means that the cash that
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you get in your account from this equity instrument doesn't
7:19
get taxed today. Your cost basis just gets marked
7:22
down every single year, meaning that you won't have capital
7:25
gains at 11 1/2 percent. With the price of stretch at
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$100 and the dividend yield being at about 11 1/2 percent,
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this means that you won't have capital gains taxes for roughly
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9 years. When you eventually sell at that
7:36
point, all of it will show up as capital gains, but then it will
7:39
also be taxed at the long term's capital gain rate.
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The real genius behind the strategy that nobody's talking
7:45
about is that after nine years, if you pass this asset to a
7:48
family member or one of your kids, they will get a step up in
7:52
cost basis. Meaning that they will have a
7:54
another nine years to get dividends tax free.
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Meaning you'll be able to earn 11 1/2% in perpetuity without
8:01
any taxes. Speak with a tax lawyer.
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But this is how this works in my mind and with this it's only
8:06
natural to ask. This is too good to be true.
8:09
There has to be some risk involved.
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Strategy must be taking on margin in order to get this
8:13
pulled off. Well, that's exactly what the
8:15
bank list team thought, and here's what Michael Saylor had
8:17
to say. OK.
8:18
So like it's your point with gold, I mean this would would
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have worked marvelously with gold.
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I I suppose the, the bed is the capital asset, the the, the
8:25
asset, the scarce asset that you're accounting on for this
8:28
type of accumulation strategy. The bet, the core bet is that
8:31
goes up relative to dollars or dollars go down relative to
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that. I mean gold from the 1930s so
8:36
now is up about 120 X. So it would have worked very
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well with gold relative to dollars.
8:43
But aren't you as well putting some margin in the company
8:46
itself or in the structure itself?
8:48
And can't you get bitten by the volatility across those years
8:52
and decades with too much margin?
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Like there's almost a question of how much margin is too much
8:58
for you to? Weather there is no margin,
9:02
there is no margin in the in the capital structure.
9:04
Let me let me make a point. Margin loans are when I borrow
9:09
against an underlying asset with the obligation to meet a
9:14
collateral call on one or two days notice.
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So margin debt is one day money, and if you actually borrowed
9:23
against the underlying Bitcoin, if you're a retail investor,
9:26
you're basically borrowing the money for a day.
9:28
And when you have volatility, that creates a lot of anxiety.
9:33
When we sell STRC, we're selling equity.
9:37
It's exact opposite. If you give me $1,000,000 for my
9:41
equity, for common equity, I have the money forever with no
9:44
obligations. OK.
9:46
That's the longest duration money when you give me
9:49
$1,000,000 to buy a preferred equity with a variable dividend.
9:53
If you read the securities document and and you understand
9:57
what that what that security is, you're entering into a perpetual
10:01
swap. I am agreeing as the issuer to
10:05
give you sulfur the standard overnight funds rate plus a
10:09
credit spread determined by the company and you are agreeing to
10:16
give the company that capital forever and and so that and
10:22
you're not getting the money back.
10:24
So it's not an overnight loan. There is no collateral call.
10:28
You have no redemption, right? Yeah, you, you can't.
10:32
It's, it's not like you can go to the bank and say give me the
10:34
$1,000,000 back tomorrow. In fact, you're not getting the
10:37
money back ever, right? It's an equity investment.
10:41
If you wish to sell the instrument, you can sell it into
10:44
the market, but you're selling it to other investors.
10:47
And so the magic of this structure is you're creating a
10:52
perpetual swap. This got stochastically.
10:56
If you were to actually do the statistical modeling, it's more
11:00
like a 20 year duration instrument.
11:02
You agree to loan the company money in perpetuity that they
11:05
don't have to pay you back. You can sell your shares, but
11:07
you're selling them to someone else who's again agreeing to
11:09
loan the company money in perpetuity.
11:11
And This is why this is the ultimate Bitcoin acquisition
11:14
machine. But we're going to talk about
11:16
not only what this means for your checkbook, for your taxes
11:19
like we just covered, but also for the world right after.
11:22
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12:01
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12:05
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Schedule a meeting with a team and they will hold your hand and
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Use the link bitcoinaway.com/partner/dante
12:30
Dash Cook and tell them I sent you.
12:31
Let's get back to the show. At the end of the day, people
12:34
are just worried about whether they're going to have enough if
12:36
you're retiring. Will I have enough to cover my
12:39
income, my bills and my expenses when I'm not earning an income
12:42
as a retired person? If you're a person that's still
12:44
working, will I have enough to pay for my bills when the cost
12:47
of inflation, the cost of my rent, the cost of my utilities,
12:50
the cost of my insurance is going U faster than the paycheck
12:53
that I'm earning? That's the fundamental question
12:55
that people want to answer. Regardless of what life stage
12:58
that you're in, regardless of what country you're in,
13:00
regardless of what geographical boundaries that you live within.
13:03
And This is why this product is able to serve a billion people,
13:06
as Michael Saylor puts it, fix the money, fix the world.
13:09
And so here's the very simple idea, right?
13:12
How do you make the world a better place?
13:14
You provide a utilitarian value, something valuable to a billion
13:19
people that everybody just agrees on.
13:21
And so, you know, with Rockefeller, it's like kerosene,
13:25
gasoline, and everybody just lives a better life.
13:28
And then with Ford, it was an automobile.
13:31
And who doesn't want an automobile?
13:33
And then Jobs gave a billion people an iPhone.
13:36
Nobody wants an iPhone, you know, and then we had like
13:39
electricity in our and, and so we all, we like those things.
13:44
So what is the equivalent and the digital asset space?
13:48
And the answer is everybody would just like a bank account
13:52
that pays them more than the inflation rate.
13:55
Like how about give me a bank account that pays me 8% right
13:59
now your bank pays you 0, right? The money market pays you 3.7%
14:05
before tax. If you live in Japan, it's 50
14:09
basis points. If you live in Switzerland, it's
14:11
nothing. So what what is the idea?
14:14
Well, I would just like Social Security or I'd like to live
14:19
comfortably ever after. I'd like, you know what we say
14:23
tongue in cheek is fix the money, right?
14:26
How do you fix the money? Well, Bitcoin people have been
14:29
thinking about how to fix the money and I think what we've
14:32
realized is the way to fix the money is to integrate the
14:37
promise of technology. What is Bitcoin represented
14:40
Represents digital capital. Digital, something that moves at
14:44
the speed of light to a billion people.
14:46
Capital scarcity, right? It it, it represents a capital
14:53
asset with integrity. So how do we fix the money for a
14:58
billion people? And what we realized is the
15:01
answer is not convincing a billion people to adopt Bitcoin
15:05
as the currency instead of the dollar or the yen or the euro.
15:10
And the answer is not getting them to, you know, throw away
15:13
their bank, replace the government, rethink their world,
15:16
you know, disclaim interest in all corporations and self
15:20
custody, right? These are all crypto ethos
15:24
things. And it's not that I'm I'm not
15:27
negative on them. They're all valuable.
15:29
But I think after five years, and believe me, I preach Bitcoin
15:35
to more people than you know anybody.
15:37
You know, it's 1000 hours and you're going to convince 1, two,
15:42
3% of the people to put 5% of their money into this asset.
15:46
You're not going to convince 75 year old retirees, right?
15:51
Not nor nor should you. So what's the great, great
15:56
product idea just to wouldn't it be great if I just bought a
15:59
product and it paid me money for the rest of my life?
16:03
Like I just want 10%, a bank account that pays me 10% or 8%
16:08
if the natural organic inflation rate is 7.
16:11
And I think you can make the argument, and I've made this
16:14
argument with you guys probably in the past over 100 years, the
16:18
natural currency debasement rate is about 7%.
16:23
And so if your money is paying you more than 7%, then you're
16:29
keeping up with the cost of living.
16:31
And if you are getting 2%, you're getting debased and
16:35
you're getting poorer. So how about bank accounts to
16:39
pay 8% to a billion? People, I've never thought of
16:42
that. An honest capital instrument
16:44
that offers the average person a rate of return greater than the
16:47
rate of inflation, which is created by people that we didn't
16:50
elect, that we didn't put into office and then have no
16:53
accountability to our needs or our desires.
16:56
What a novel idea. But here's the part that made me
16:58
think that Bitcoin is going to become the global reserve
17:01
currency of the world, and it's going to be done through a
17:03
Trojan horse back doorway. Listen to what Sailor has to
17:06
say. How?
17:07
Do you create that? So we create a credit
17:10
instrument. We stripped the ball off of it.
17:12
You know, we offer 11, but you know, if you're a bank in
17:17
Australia, you could just take that 11 and you could pass
17:20
through 8, convert it to AUD. And if you're a bank in Europe,
17:23
you could offer 6 or 7% in euros.
17:27
So we basically create digital credit and we offer it to
17:31
Deutsche Bank and JP Morgan and Commonwealth Bank and Morgan
17:35
Stanley and BlackRock and Vanguard.
17:38
And if people, you know, if you think of it as just high-powered
17:42
money, what is high-powered money?
17:44
It's a unit account, a store of value, a medium of exchange.
17:48
Well, stable coins proved that they were medium of exchange and
17:52
unit of account. But if we cripple their ability
17:54
to pay yield, they're not a store of value.
17:57
So I want something that's stable to the dollar, but I want
18:01
it to appreciate ideally tax deferred more than 7%.
18:06
That's the gangster move. They're going to start offering
18:08
this to banks and other people whose clients are going to want
18:10
a piece of that 11 1/2% dividend yield.
18:13
So effectively, the banks are going to start taking a spread
18:16
on stretch, offering their customers a lesser rate, which
18:19
is higher or more than double the amount of SOFR plus 2 1/2
18:22
percent that they've been offering.
18:24
And in doing so, their customers without knowing, are creating
18:28
more of a supply shock on Bitcoin, which is driving even
18:31
more volume into stretch. That's the Trojan horse for
18:34
Bitcoin to take over the world. Even without this, Bitcoin has
18:36
been by far the fastest asset to reach a trillion and $2
18:39
trillion. Sailor thinks we get the 21
18:42
million or a $400 trillion valuation.
18:45
And in order to do this, MicroStrategy just needs Bitcoin
18:48
to grow at 2 point O 5% a year in order for them to pay these
18:51
dividends forever. In effect, creating an infinite
18:54
perpetual money machine to acquire Bitcoin to apply the
18:57
supply shock of all supply shocks.
19:00
This is giving the world a digital capital, an honest
19:03
digital yield in a way to outpace inflation.
19:06
The revolution is just beginning, but you're going to
19:09
be on the front and bleeding edge of this if you subscribe to
19:12
this show. Subscribe to the show if you
19:13
already haven't. This is Dante Coco Bitcoin
19:16
simply happy stacking and if you haven't started accumulating
19:19
Bitcoin beyond just buying spot well, you can get into buying
19:22
Bitcoin through Bitcoin mining. We talked about a way how
19:25
through Stretch allows you to have a return on capital or
19:28
deferring your capital gains to some point in the future.
19:31
You can also offset your capital gains by buying assets that you
19:35
can depreciate like you can with Bitcoin miners.
19:37
Work with the team at SAS Mining and they'll talk to you all
19:39
about this. Give money to the team at SAS
19:41
Mining. They help you to buy and own a
19:43
Bitcoin mining machine. They keep it up, they keep it
19:45
repaired. They hosted for you on your
19:47
behalf, and they send SAS directly to your wallet.
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There's no easier way to stack SAS and an easy way to get a tax
19:51
benefit. This is Dante Coke with Bitcoin.
19:53
Simply, we're out.