“Michael Saylor’s LAST Laugh” - Strategy Faces $11B Bitcoin CRISIS

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**Patrick Bet-David** (0:30)
He's got different kinds of problems he's dealing with, but he's staying cool, calm and collected. And that's Michael Saylor, who is $10 billion Bitcoin hole. What does strategy do now? I don't know if you guys have seen this. Bitcoin is down now 50% of its high that it hit. I don't know what the number is right now. It could be between 59 to $61,000. It's at $60,000 as of right now. If you go max, go to five years, Rob.
Look at the peak right there. Go all the way to the peak, 21, 25, 120 something.

**Tom** (0:55)
Yes.

**Patrick Bet-David** (0:56)
So it's down 50% from its peak.

**Tom** (0:59)
Just last fall.

**Patrick Bet-David** (1:00)
That's right. Just last fall. And so Strategy Inc. is facing renewed scrutiny as the company faces an unprecedented $10 billion of unrealized loss on its Bitcoin holding. Marking commentator Kyle argued on X on June 4th that the company's preferred share dividend obligations could turn Michael's Saylor from Bitcoin's biggest buyer into potential for seller. The company's Bitcoin accumulation model worked while the company funded purchases through equity issues, convertible notes and other financing tools that did not require near-term cash payments. The concern now is that strategy's newer preferred share products, including Nasdaq's STRC carry yield obligation. Strategy owns roughly 4% of Bitcoin's total supply, making it balance sheet one of the biggest swing factors in crypto markets. Kyle argued that earlier strategy financing was easier for both to defend because common equity has no guaranteed return. The company could sell the stock, sell Bitcoin and rely on BTC's long-term appreciation to support share price. Preferred shares changes the math, he said. Tom, your thoughts on this.

**Tom** (2:03)
So I take us back into history.
You know, let's go back to Elon Musk's difficult and painful 2018 Remember when we talked about Elon Musk? Oh my gosh, the debt's coming due. He has so much debt on the gigafactories and he's doing this to build batteries. He's doing all this and he's spending all this thing and he went down. He's trying to build a launch pad at the end of Texas. What's he going to do? And you remember all this, Adam? You remember this? We talked about this. All of a sudden guess who will show up?
Middle East financiers show up or he comes up with a bond and shows up. Great entrepreneurs find a way out right here. The real question isn't, oh my gosh, is he going to sell the Bitcoin is going to crash? Maybe that hat that happens. What happens if the market crashes tomorrow and Bitcoin bounces back to 115 or 120 or beyond it? What if Bitcoin gets to 140 because our own Senate can't get out of its own way and we can't get things passed and we have this debt and we have all the things going on and we have the inflation spike statistics get used and Kevin Warsh is forced to actual raise rates, which I don't think is a good idea. What happens if all this happens? You know what happens?
Guess what?
The market is going to crash. It's going to be tough. And what if Bitcoin bounces back as the alternative asset at that point? Where's Michael Saylor then?
I think people are talking here are just, you know, they love to point at him. He was the first balance sheet company, right? Where the Bitcoin on the balance sheet is really the reason to own the stock. You know, I bet that's how I feel, Pat. I think people are making a lot out of this. The math they're doing is correct. He does have dividends to hit. But I remember 2018, how hard it was for Elon Musk, you know? And how he had to go back in 2018 But guess what? He found financing partners. He got it done. He then achieved the launches on SpaceX. He launched more Starlinks. He figured out great entrepreneurs find a way to get it done. And I think Michael Saylor will find a way to figure out the financing and to figure out what he's going to do on this. Because guess what? If a stock goes down, if you owned 100 shares of Nvidia, let's say a month ago, and you bought them at 230, I think three weeks ago, two weeks ago, it was like 230 And now today it's like at 220 And you own 100 shares. I lost a little. On paper, you're down 20 bucks. It's now 211 this morning.