@parkeralewis@AdamBLiv@parkeralewis I ran a quick model with these assumptions, with a hypothetical starting point of 100 BTC and 1,000,000 shares, and conservatively assuming dividends are funded with BTC, instead of equity at a premium. The returns are 33% vs 30% for $BTC. I'll DM the excel to you.
@jackmallers Our mNAV uses the standard conventional framework.
mNAV = Enterprise Value / Bitcoin Reserves
Enterprise Value
= Common Equity Market Cap
+ Preferred Equity Notional Value
+ Convertible Debt Notional Value
- USD Reserve
The convertible debt is not treated "as-converted". It is treated as debt regardless of being ITM (in-the-money) or OTM (out-of-money).
*IF* we were treating OTM convertible debt as converted into common equity in our formula, it would actually lead to a lower Enterprise Value. This is because you would replace the convertible debt with less common equity. This would lead to a lower mNAV and not higher.
An intuitive way to understand this is that a convertible debt investor will demand cash at maturity if it is OTM, because the alternative is converting it into common equity shares which are worth less than the cash (precisely because it is OTM).
Hope this helps. Happy to chat live to discuss this further.
@mattkratter@LaHvaSomSkjer@mattkratter Bitcoin is money in the Austrian frame of reference. But it is a volatile, long-duration asset for most individuals/businesses, viewed from the conventional lens. Everyone is incentivized to spend USD instead of $BTC (Gresham's Law).
https://t.co/ff6uueHl1h
@mattkratter@btc_is_hope@parkeralewis@mattkratter would you consider all M&A transactions by conventional businesses to be bad if they are funded by common stock issuance, since they technically lead to share dilution? Or is it dependent on the price of stock issuance and the price of the asset acquired?
This month marks Gypsy, Roma and Traveller History Month.
Despite facing discrimination in many areas of life, our Gypsy, Roma, and Traveller communities have long contributed to life in our capital and today we celebrate that rich legacy.