Nathan C. Perry

SIC SEMPER TYRANNIS

[Nathan C. Perry @NathanCPerry]

@WayneVaughan https://t.co/Sun4R4iVO7

[Nathan C. Perry @NathanCPerry]

Bitcoin’s price is strongest when you want to continuously vomit and weakest when you feel invincible.

[Nathan C. Perry @NathanCPerry]

.@ColeMacro: Saylor cannot buy it back an hour later and harvest the losses for tax purposes. The transaction lacks economic substance and will likely be disallowed by the IRS. He's effectively got to be out of the market for 48 hours after the last sale. Sincerely, your friendly neighborhood corporate tax attorney.

[Anthony Pompliano 🌪 @APompliano]

Strive CEO @ColeMacro explains why Michael Saylor sold 32 bitcoin.

"he had to message 'I am willing to do this' and that willingness to do that was always going to come with the critics saying 'oh this is a tip of the iceberg. First its 32, next its going to be 3,200.'"

"your goal should be maximizing total returns. bitcoin's your hurdle rate, but ultimately the goal is you want to maximize the total returns for your common equity shareholders."

[Nathan C. Perry @NathanCPerry]

@RepJackKimble @YourAnonNews Yeah, though the 247 pounds are all dead weight after he takes the helmet off.

[Michael Saylor @saylor]

@leadlagreport No.

[Nathan C. Perry @NathanCPerry]

@saylor @leadlagreport 😂

[Nathan C. Perry @NathanCPerry]

The Lindy effect.

[Watcher.Guru @WatcherGuru]

Exactly 15 years ago today when Bitcoin was trading at $15, Hal Finney said:

"Every day that goes by and Bitcoin hasn't collapsed…increases the chance of Bitcoin's eventual success and justifies a higher price."

[Nathan C. Perry @NathanCPerry]

@TXMCtrades I’ve been after this for a long time. Good luck!

[Nathan C. Perry @NathanCPerry]

@ScotiaHodl @FossGregfoss @jyn_urso It’s not really backed by energy either. That would imply I could be guaranteed a certain amount of energy for x amount of bitcoin. That’s not how it works. Energy is being used to protect the ledger from various attacks. And that’s enough!

[Nathan C. Perry @NathanCPerry]

@willcole Is that a crash out? Or more like a realization he just needs to step away for bit?

[Nathan C. Perry @NathanCPerry]

It's levered bitcoin, yes. He calls it amplified bitcoin but levered is fine. You can lever up without NAV increasing. That's what debt, the preffereds let him do. If mNAV expands he's actually more likely to issue common shares which decrease the leverage of the company, though he may issue both MSTR shares and STRC at the same time.

And the idea Saylor hasn't been a good trader is laughable. All that does is look at the current price of BTC against his cost basis and say it's down. But at what prices of the various derivatives he's selling did he manage to get those capital raises in? Again, he doesn't care about the short term price of BTC. He cares about whether sats per shares goes up. So if BTC is at a $126k but your mNAV is at 2x, you sell shares, buy BTC, sats per shares goes up. So what if BTC goes down in the short term? Yes, he's technically underwater in USD terms on that trade but he's up in sats per share on the trade and, as I said, that's the trade he cares about in the short term.

THIS IS SAYLOR'S SIMPLE IDEA THAT HE IS TAKING SERIOUSLY: If MSTR's networth in BTC goes up, in the long term MSTR's networth in USD will go up with it. That's it. That's the simple idea.

So he's found a way to do that in a way he believes (and I believe as well) does not add too much risk to the company.

An so far, over the almost 6 years he has played this game MSTR is up 46% annualized vs BTC's 34% annualized. That's 12% per year of alpha he has added and we're measuring in the middle of a bear market (probably near a BTC low). But you think he's a bad trader? LOL

[Nathan C. Perry @NathanCPerry]

@Nicolascole77 Relatedly: https://t.co/P750Sd7xw0

[Nathan C. Perry @NathanCPerry]

It's levered bitcoin, yes. He calls it amplified bitcoin but levered is fine. You can lever up without NAV increasing. That's what debt, the preffereds let him do. If mNAV expands he's actually more likely to issue common shares which decrease the leverage of the company, though he may issue both MSTR shares and STRC at the same time.

And the idea Saylor hasn't been a good trader is laughable. All that does is look at the current price of BTC against his cost basis and say it's down. But at what prices of the various derivatives he's selling did he manage to get those capital raises in? Again, he doesn't care about the short term price of BTC. He cares about whether sats per shares goes up. So if BTC is at a $126k but your mNAV is at 2x, you sell shares, buy BTC, sats per shares goes up. So what if BTC goes down in the short term? Yes, he's technically underwater in USD terms on that trade but he's up in sats per share on the trade and, as I said, that's the trade he cares about in the short term.

THIS IS SAYLOR'S SIMPLE IDEA THAT HE IS TAKING SERIOUSLY: If MSTR's networth in BTC goes up, in the long term MSTR's networth in USD will go up with it. That's it. That's the simple idea.

So he's found a way to do that in a way he believes (and I believe as well) does not add too much risk to the company.

An so far, over the almost 6 years he has played this game MSTR is up 46% annualized vs BTC's 34% annualized. That's 12% per year of alpha he has added and we're measuring in the middle of a bear market (probably near a BTC low). But you think he's a bad trader? LOL

[Nathan C. Perry @NathanCPerry]

@ActuallyClimber So the earliest we can know if your prediction is right is October 6, 2029 and it could take up October 6, 2031.

[Nathan C. Perry @NathanCPerry]

It's levered bitcoin, yes. He calls it amplified bitcoin but levered is fine. You can lever up without NAV increasing. That's what debt, the preffereds let him do. If mNAV expands he's actually more likely to issue common shares which decrease the leverage of the company, though he may issue both MSTR shares and STRC at the same time.

And the idea Saylor hasn't been a good trader is laughable. All that does is look at the current price of BTC against his cost basis and say it's down. But at what prices of the various derivatives he's selling did he manage to get those capital raises in? Again, he doesn't care about the short term price of BTC. He cares about whether sats per shares goes up. So if BTC is at a $126k but your mNAV is at 2x, you sell shares, buy BTC, sats per shares goes up. So what if BTC goes down in the short term? Yes, he's technically underwater in USD terms on that trade but he's up in sats per share on the trade and, as I said, that's the trade he cares about in the short term.

THIS IS SAYLOR'S SIMPLE IDEA THAT HE IS TAKING SERIOUSLY: If MSTR's networth in BTC goes up, in the long term MSTR's networth in USD will go up with it. That's it. That's the simple idea.

So he's found a way to do that in a way he believes (and I believe as well) does not add too much risk to the company.

An so far, over the almost 6 years he has played this game MSTR is up 46% annualized vs BTC's 34% annualized. That's 12% per year of alpha he has added and we're measuring in the middle of a bear market (probably near a BTC low). But you think he's a bad trader? LOL

[Nathan C. Perry @NathanCPerry]

It's really not hard to understand. It's a measure of the percentage change (positive or negative) of sats per share (or bitcoin per share) over a given timeframe.

Saylor is making that his primary metric of concern because, like me, he thinks that if you increase your networth or a company's networth in bitcoin terms, USD networth will follow over the long term.

I explained this years ago before Saylor ever introduced the term bitcoin yield. See below for my longer post on this.

His only other concern is maintaining what he calls "intelligent leverage". Basically it's enough leverage to meaningfully increase the return of the derivative (MSTR) when measured against the underlying asset (BTC) without risking the company blowing up when the underlying asset drops in a bear market like now.

[Greg @gkamstra]

@devahaz

[Nathan C. Perry @NathanCPerry]

@adamtaggart My guess is we’re pretty close. I’m starting to feel that vomit sensation. 😂

[Nathan C. Perry @NathanCPerry]

Bitcoin’s price is strongest when you want to continuously vomit and weakest when you feel invincible.

[Nathan C. Perry @NathanCPerry]

Bitcoin’s price is strongest when you want to continuously vomit and weakest when you feel invincible.

[Nathan C. Perry @NathanCPerry]

@ryQuant @_JesseMK @Strategy @BitStrategy21 Haha!

[Nathan C. Perry @NathanCPerry]

The preferred equity holders literally have some of all of this. "creditor status, principal repayment rights, default remedies, creditor priority, etc."

That's why it's a hybrid instrument. They are equity shares with debt like characteristics and some with more debt like characteristics than others. The two most equity like for different reasons are STRK and STRD. STRK because it has a direct connection to the equity w/ it's convert option. STRD because the dividends are do not compound if they are not paid. The others do.

The creditor status, principal payment rights, and creditor priority only trigger in the case of liquidation but they are there.

The default remedies trigger if they fail to make the dividend payments. (They get to put people on the board, the dividends compound and must be paid out first when dividends are restarted, etc. with the exception of STRD.) But there are a lot of things that happen if the company fails to make those dividend payments.

[Be Water @bewaterltd]

The fact that Moody’s evaluates the likelihood of a (discretionary) preferred equity dividend suspension does not magically transmute a pref into debt. That argument 1) conflates a rating-agency risk lens with both the legal and economic substance of the instrument, and 2) is potentially misleading re: where it slots into institutional portfolios (i.e., this may cause retail investors to vastly overestimate the total addressable market, issuance runway, and earnings potential of a BTCTC).

Preferred stock is legally equity, not debt; it's right there in the NAME "preferred stock" for a very good reason. Sophisticated institutions generally understand the difference, which is why the pref market is maybe .5% of the bond market, and overwhelmingly concentrated among (profitable, cash flowing) banks who issue them for regulatory capital purposes.

Putting "digital credit" in retail-facing marketing is arguably highly misleading. Retail may reasonably conflate equity with debt: it risks implying creditor status, principal repayment rights, default remedies, creditor priority, etc. that pref holders do not have.

tldr; Moody's can rate the risk of nonpayment but that does not make it debt. Calling prefs "digital credit" blurs the distinction in a way that is potentially very confusing to retail.

cc @parkeralewis

[Nathan C. Perry @NathanCPerry]

And BTC in cold storage.

[Mark Manson @Markmanson]

The best investments are the things no one can take away from you: knowledge, experience, mindset, attitude.

[Nathan C. Perry @NathanCPerry]

@chowcollection Only if they can stay at or near par w/o needing to drastically raise the yields. This will be a real test for them. I have high hopes for both. But this is the real stress test we've been waiting for.

[Nathan C. Perry @NathanCPerry]

https://t.co/EnbEiQvuBh

[Nathan C. Perry @NathanCPerry]

I wrote this on #Nostr. Hopefully it further explains what Preston understands.

Sats per share is the only metric that matters.