MicroStrategy Is Secretly Developing A Plan To Sell Its Multibillion-Dollar Bitcoin Holdings

In a recent Twitter thread, "Mr. Whale," the pseudonymous self-described contrarian cryptocurrency analyst and investor, accused MicroStrategy of surreptitiously developing a dubious exit strategy for its Bitcoin investment.

Additionally, the sceptic disparaged Michael Saylor, the CEO of the business software company, by referring to him as a "swindler" with a history of frauds and investigations. For reference, he adds that Saylor hacked accounting data in the 2000's, which resulted in the SEC charging him with fraud; in 2013, he expressed anti-Bitcoin sentiments; and in 2020, he used Bitcoin exclusively for PR purposes while surreptitiously dumping in the market.

Mr. Whale anticipates that Saylor and his company will exit the Bitcoin market this time. According to him, the signs suggest that the company's recently formed subsidiary, MacroStrategy, obtained 92,079 Bitcoins from the parent company's holdings. According to him, MacroStrategy will be able to sell the coins without filing with the Securities and Exchange Commission.

This interpretation has created controversy, with some observers defending it and others attempting to discredit it. To be fair, Mr. Whale's indicators were originally announced in June, when MicroStrategy announced a capital raising to purchase additional Bitcoin.

The company disclosed that it raised approximately $500 million from qualified institutional buyers through the sale of senior secured notes due in 2018. Additionally, the release highlighted that the notes were guaranteed by the company's entire asset base, with the exception of the Bitcoin currently held by a subsidiary.

Notably, the corporation continued to purchase Bitcoin despite the extreme volatility and criticism at the time, paying over $489 million to add 13,005 Bitcoin to its portfolio. Additionally, between July 1 and August 23, the corporation acquired 3,907 Bitcoins for approximately $177 million. The corporation presently has 108,992 bitcoins, which it purchased for an overall purchase price of $2.918 billion and an average price of $26,769 per bitcoin. At current Bitcoin prices, the holdings are worth almost $5 billion.

Saylor, who has yet to reply to the claims, has been a vocal proponent of Bitcoin. Despite risks of incurring nett losses on the investment and continually declaring impairment losses, the Saylor-led company has not sold its shares to yet. During the June quarter of 2021, the company reported an impairment loss of $424.8 million. Saylor, on the other hand, has claimed that he is unconcerned about short-term trends since he is playing the long game and aims for his company to be at the forefront of Bitcoin's future.

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