ɢᴅʀ252

dilettante, generally optimistic. 🟢🟢🔴🟢🟢🟢🟢

[ɢᴅʀ252 @gdr252]

@Henrytheefirst market can take away far more than the IRS can. sell it all & put it in $SATA & live on the $1.8M/yr. tax-deferred. and never touch your egg.

[ɢᴅʀ252 @gdr252]

@ActuallyClimber sign of a maturing asset. still climbing that ladder, though.

[ɢᴅʀ252 @gdr252]

@EricBalchunas https://t.co/TukTXlSSHi

[Bill Miller @billfour]

Word is @SpaceX ipo will come at 40x price/sales; IPOs pricing at that valuation return on average -50% over the next three years h/t @Jefferies

[ɢᴅʀ252 @gdr252]

@JoshMandell6 @dotkrueger

[ɢᴅʀ252 @gdr252]

@dampedspring Strategyᴮ isn’t competing with ₿. it’s competing for capital that can’t or won’t buy ₿.

[ɢᴅʀ252 @gdr252]

@RyansMethod @PunterJeff

[ɢᴅʀ252 @gdr252]

@Z06Z07 https://t.co/wbEdwcpNJY

[Bit Paine ⚡️ @BitPaine]

Bitcoin is the Penny Lane’s tits of assets.

[ɢᴅʀ252 @gdr252]

@HermesLux inefficient producers shut down, hash rate ↓, difficulty adjust ↓, surviving miners produce corns more cheaply. many stop selling/hoard. new supply hitting exchanges ↓. 🔁

[ɢᴅʀ252 @gdr252]

@thebtcpharaoh management has a set of tools. volatility makes those tools more valuable. 🤝 ↑₿PS

[ɢᴅʀ252 @gdr252]

@Giovann35084111

[ɢᴅʀ252 @gdr252]

@Z06Z07 but…. daily divs haven’t been implemented yet….

[ɢᴅʀ252 @gdr252]

@phil_geiger @TrekBikes wen MARS® ?

[ɢᴅʀ252 @gdr252]

@EricBalchunas @YouTube Badlands features Justin Vernon doing that tornado-siren style vocal based on an actual thing that happens in our fair city every Saturday @ noon.

[ɢᴅʀ252 @gdr252]

@orangeyield operations are generating surplus cash,
helping reduce claims/drag. the operating business is functioning as a stabilizer rather than a distraction.

[Bobby Tierney @chcbearsfan]

Metaplanet added 5,075 BTC and net claims actually fell $34.6M. CEBE +6.9%. Drag compressed 3.4 pp. Common equity ownership climbed to 86.1%

No other company in the tracker did this. Most added BTC and claims together. Metaplanet added BTC and reduced claims. That's the operating business working

[ɢᴅʀ252 @gdr252]

@JoeConsorti

[ɢᴅʀ252 @gdr252]

@SuperBitcoinBro @JoeCarlasare he RTed you so he likely agrees. was just confusing in the context of this prev comment.

[ɢᴅʀ252 @gdr252]

@ZynxBTC srs question: why would a U.S. investor choose a mtplnt preferred over STRC or SATA if there ever was one?

[ɢᴅʀ252 @gdr252]

@JoshMandell6 @Strategy https://t.co/gZHRQOxziy

[THE BITCOIN PHARAOH @thebtcpharaoh]

The 2029 $MSTR Convert Buyback Is Not What It Looks Like

It's been a while since I posted on MSTR because there's generally a lot of coverage - and I'd rather only post when I have something to add to the discourse. Like many of you probably, @saylor orange pilled me (MSTR class of 2022) and I haven't looked back since.

There's been some important developments lately, and I'd like to weigh in.

Saylor is an incredibly intelligent financial engineer (I'm sure even @JoshMandell6 would agree). And I think that reading friday's $1.5B convertible buyback as deleveraging actually misses the trade.

While it may look like they're just retiring less favorable debt for a 'healthier' balance sheet, the actual action is a clean short on MSTR's implied vol.

Here's how the numbers work out.
Strategy is buying back $1.5B of its $3B 0% convertible senior notes due Dec 2, 2029. Settlement around May 19. Conversion price: $672.40 per share. $MSTR price: ~$175. For these notes to convert into common stock at maturity, the stock has to achieve a 284% gain in 3.5 years (46% CAGR).

A year ago, $MSTR was $400+. Those same 2029 converts traded above par because the embedded call option had real conversion value. Today, with the stock at $175, that call is deeply out of the money. The bond traded at roughly 92 cents on the dollar.

Enter Saylor.

The headline trade.
$1.5B face retired for $1.38B cash. An 8% discount to par. Roughly a 2.3% annualized IRR on the debt itself. By bond-math standards, that's nothing remarkable.
But that's not the trade.

The actual trade.
The actual trade is the dilution being retired.
$1.5B face divided by a $672.40 conversion price equals approximately 2.23 million potential shares. If MSTR rerates above $672.40 by maturity, those shares would have been issued. Every dollar above $672.40 is equity dilution to existing holders.
So consider the asymmetry. If MSTR sees $1,000 by Dec 2029, those 2.23 million shares represent $2.23B of dilution Saylor just retired — an ~$850M saving vs. doing nothing. At $1,500, the dilution retired is $3.34B — nearly $2B in savings. And if MSTR stays below $672.40, the converts wouldn't have converted anyway, and Saylor still banks the $120M discount and clears the 0% debt early.

Who's on the other side.
Convertible arbs. When MSTR fell from $400+ to $175, their hedge worked. The embedded call decayed. Their position printed and now they want their capital back.
They sold optionality they had stopped pricing.
This is the equivalent of a cash-secured-put run in reverse. When implied vol on a name you have conviction in compresses, you buy back the convexity you originally sold. Saylor isn't selling vol here. He's buying it back.

Where this is wrong.
If MSTR stays below $672.40 through Dec 2029, the converts never convert. The buyback economics / return shrink to a small one. Not a disaster, but not the trade of the year. The asymmetry really pays if MSTR rerates. That's the bet Saylor is making.

Make of it what you will. Issuing the converts was Saylor selling MSTR's upside (even if he said otherwise at the time); buying them back is Saylor purchasing it. He's not telling you he's bullish — he's paying paying $1.38B to buy it back.

#Bitcoin

[ɢᴅʀ252 @gdr252]

@btc_overflow 🤙🏼 tyvm