Michael Saylor defended his company’s debt-fueled, bitcoin buying spree over the last year by saying it continued to be a great investment.
The CEO of MicroStrategy, a business intelligence firm that provides mobile software, and cloud-based services, which has more than 105,000 bitcoins in its rreserves, told CNBC on Friday that borrowing money now to buy additional bitcoin is similar to early-stage investing in one of today’s most powerful tech businesses.
“If you borrow billions of dollars at 1% interest and invest it in the next Big Tech digital network that you thought was going to be the dominant Amazon or Google or Facebook of money, why wouldn’t you?” MicroStrategy’s Michael Saylor told CNBC. “I mean, if I could borrow $1 billion and buy Facebook a decade ago for 1% interest, I think I would’ve done quite well.”
“Our point of view is being a leveraged, bitcoin-long company is a good thing for our shareholders
Saylor stated that his company owes $2.2 billion in debt and pays an annual interest rate of around 1.5 percent. Since last August, his company has used cash flow, equity issuance, convertible debt, senior secured debt, and a $1 billion shelf registration to fund its enormous bitcoin purchases.
MicroStrategy’s bitcoin assets were valued $3.65 billion at the end of June, reflecting bitcoin’s market price of $34,763 at the time. The digital asset cost basis of their holdings was $2.74 billion, or $26,080 per bitcoin, according to non-GAAP (generally accepted accounting principles).