Michael Saylor, CEO of MicroStrategy, told CNBC on Tuesday that he believes bitcoin will continue to rise in value to the point where the cryptocurrency will become a “stabilizing influence” for the entire world. global financial system He predicted, in a bold appeal, that the market value of bitcoin would be worth $ 100 trillion someday
Saylor’s comments on “Squawk Box” come as the price of bitcoin fell more than 10% on Tuesday, falling below $ 50,000 a unit This drop brought the market value of the world’s largest cryptocurrency below $ 1 trillion, just days after volatile digital asset eclipsed that level for the first time.
However, Bitcoin was still up 60% since the start of the year and over 360% in the past 12 months
“There’s a $ 500 trillion money planet and the outer layer is money, then you’ve got stocks, bonds, real estate There’s $ 10 trillion gold in there, $ 1 trillion worth of bitcoin in there Bitcoin will reverse gold and encompass the entire market cap of gold, ”said Saylor, who has become one of bitcoin’s foremost evangelists since his birth. enterprise software publisher started buying it in August
“Then it will encompass negative yielding sovereign debt and other currency indices until it hits $ 100 trillion. Once it hits $ 10 trillion, its volatility will be considerably less,” continued Saylor, “As that gets closer to $ 100 trillion, you’re going to see growth rates drop, volatility drop, and that will be a stabilizing influence throughout the 21st century financial system.”
In addition to his company’s large bitcoin holdings, Saylor told CNBC he also owns the digital coin in his personal capacity.
Bitcoin has been called ‘digital gold’ by some crypto-bulls, and they tout its ability to serve as a store of value due to the fact that its total supply is capped at 21 million coins Currently, there are 1,864 million coins in circulation, according to Coindesk New bitcoins are hitting the market as a reward for so-called miners, who use very powerful computers to verify transactions in the decentralized system
Saylor set out her grand vision for bitcoin a day after Treasury Secretary Janet Yellen again raised questions about the digital coin She said she was worried about its role in ‘illicit financing’ and consumption of energy used to mine bitcoin
“It’s a highly speculative asset and you know I think people need to be aware that it can be extremely volatile and I’m worried about the potential losses that investors may take,” Yellen added, also Former Federal Reserve Chairman, New York Times DealBook Conference
In an interview last week on CNBC, St. Louis Fed Chairman James Bullard said he was not concerned about the potential of bitcoin to reverse the US dollar’s status as a currency. world reserve
“I just think for Fed policy it’s going to be a dollar economy as far as the eye can see – a global dollar economy as far as the eye can see – and if the price of gold goes up or down, or bitcoin price goes up or down, it doesn’t really affect that, “Bullard said on” Squawk Box “
Saylor said he sees demand for Bitcoin increasing in the years to come, not only from institutions but from individuals around the world, which would have the effect of driving up its value.
“I think you can expect a billion people to store their value, basically a savings account, on a mobile device within five years and they’ll want to use something like the bitcoin, “he argued, describing it as” the dominant digital currency network “
Last week, MicroStrategy completed its second convertible debt offering with the aim of using the net proceeds to buy bitcoin The first debt sale amounted to $ 650 million in December The offer ended Friday generated approximately $ 1.03 billion in net proceeds with the notes bearing a 0% coupon
MicroStrategy unveiled its first cryptocurrency purchase in August, putting existing cash on its balance sheet for the acquisition of almost 21,500 bitcoins The company owned nearly 72,000 bitcoins, in a regulatory filing on February 2 At around $ 47,000 in Tuesday’s trading, this stake is worth almost $ 3-4 billion
Saylor argued that the company should hold bitcoin as an investment, instead of holding cash or short-term government bonds, as the digital coin will generate much higher returns in the long term. In December, Saylor publicly encouraged Tesla CEO Elon Musk to do just that.Slightly over a month later, Tesla announced that it had bought $ 1.5 billion in bitcoins
Some have been skeptical of MicroStrategy’s push to bitcoin, especially when it comes to issuing debt to fund additional purchases In a note to clients at the end of January, the Citi analyst , Tyler Radke, called it “aggressive” and “potential transaction breaker” for some software investors”
MicroStrategy’s shares have taken off since the Virginia-based company began acquiring bitcoin as investors looked for ways to gain exposure to the digital coin The stock traded around $ 120 in early August before the firm’s entry into the crypto space was made public, but started rallying throughout the fall and into 2021.
MicroStrategy’s share hit its highest level since the dot-com boom on February 9, hitting $ 1,315 per share It has fallen sharply in recent days and has fallen more than 20% in the session Tuesday at less than $ 700 per share Still, MicroStrategy has nearly doubled since the start of the year and has grown 400% in the past 12 months
With bitcoin prices falling, Tesla shares also suffered significant losses, up to 20% in the last two sessions Tesla’s drop on Tuesday sent the headline negative for 2021 However, Tesla was still in 250% increase in the last 12 months
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World News – FI – MicroStrategy CEO Says Bitcoin Will One Day Have A $ 100 Trillion Market Value Even As Prices Fall