Michael Saylor is perhaps one of the most ardent supporters of Bitcoin in the world. Saylor, an MIT graduate and co-founder and CEO of business intelligence firm MicroStrategy, has been a hero to Bitcoin loyalists since his company began stockpiling the cryptocurrency in August 2020. MicroStrategy CEO Michael Saylor borrowed money to buy Bitcoin. He stated that if Bitcoin drops to $21,000, he will receive a margin call.
MicroStrategy and Bitcoin’s relationship
The CEO went so far as to call Bitcoin “freedom” and “the most universally desirable feature in space and time” . At Bitcoin 2022 Miami, the biggest Bitcoin event worldwide, Saylor was greeted by thousands of cheering fans as he instructed the crowd to never sell their crypto. According to US Securities and Exchange Commission (SEC) documents, MicroStrategy added $215 million worth of Bitcoins at an average purchase price of $44,645 per coin in the first quarter, bringing its total assets to $3.97 billion, or 129,218 Bitcoins for $30,700 per coin.
$MSTR “added $215m worth of Bitcoin at an average price of $44,645 per coin in the first quarter, SEC filings show, bringing its total holdings to 129,218 Bitcoins acquired for $3.97B, or $30.7k per coin.” we are getting close with Bitcoin $34.5k now 👀 https://t.co/FKYxXosdpR
— Thea L 🦊 (@foxglobalinvest) May 8, 2022
MicroStrategy’s CFO Phong Le, the company said on Tuesday. On its first-quarter earnings call, it revealed that if Bitcoin’s price drops below $21,000, or about 50 percent below current levels, it will have to buy more cryptocurrencies to support its $205 million Bitcoin secured loan. “We got the loan with 25 percent LTV; margin call occurs at 50 percent LTV. So essentially, Bitcoin needs to cut in half or around $21,000 before making a margin call,” he said. The CFO noted that MicroStrategy still holds a “pretty much” portion of unsecured Bitcoin that it can use to respond to any potential margin calls.
Analyst: Bitcoin is on the edge of a great abyss
Meanwhile, according to analyst Mike Shedlock, “Technically speaking, Bitcoin is on the edge of a great abyss. The next level of support is somewhere between $17,500 and $19,000”. However, while conveying that this does not guarantee that BTC will fall that much, he states that we are currently in a bear market and prices may start to break the support levels.
Meanwhile, Saylor said he will promise more assets. According to Shedlock, this “does nothing but set an even lower level of pain.” According to the analyst, this time MicroStrategy (MSTR) is trading like a speculative, leveraged game in Bitcoin and asks “How long is it before a margin call” and in the survey of 270 people, the answer “within 1 month” seems to be the leader.
How Many Days Before Bitcoin Hits a Level of 21,000?
— Mike "Mish" Shedlock (@MishGEA) May 11, 2022
