Saylor争取到时间，但比特币仍有问题

Bank list Nation. I'm here with Jeff Dorman. He is the CIO at Arca. We had Jeff, we've had Jeff on the podcast a number of times, but not recently. Jeff, welcome back to the podcast. >> Great. Thanks for having me. And quick disclaimer, this is uh my own information and not uh investment advice. >> We also have Matt Walsh, founding partner at Castle Island Ventures. Also, we've had Matt on the podcast plenty of times, but not recently. Matt, welcome back. >> Good to see you, David. Good to see you, Jeff. All right. So, uh, Michael Sailor and Strategy are in a bit of a predicament. They might might have bought themselves some time, but I don't know if they're really out of the predicament, and I want to go it through with you guys exactly the nature of this predicament. Maybe just to really start this question off, I think the question that I would like to know is, will Stretch ever trade back at $100 ever again?

Uh, maybe Jeeoff, I'll just throw that one to you and just see see what you think about that. Uh I think it can. I mean actually I I'll caution everything I'm about to say throughout this entire uh discussion is that you can't really talk in absolutes with strategy. Everything has probabilities. So I would say the probability is very low uh probably single digits that it gets back to 100. But it can I mean you know uh ultimately there's two cohorts of people who buy something like stretch right?

One is sort of uninformed retail, kind of like your mom and pops who all they care about is every month did the dividend get paid and if so they're happy uh because they're living on a fixed income and don't even look at the monthly statements or the actual uh capital. Um and two are people who are probably doing the probability math of well how many months of runway do we have and is it worth getting 12 points of interest every year relative to a chance that it might fall 40 or 50 points if they ever cut the dividend. So, I think it's going to be a a less than useful tool for strategy going forward in terms of issuance. I don't think it'll ever get above 100 in a meaningful way where they can actually sell a ton of it to buy more Bitcoin. But I wouldn't rule it out that that it gets back to the, you know, mid to high 90s eventually as as you know, the story kind of calms down and people recognize that they've got two years of of dividend coverage. Now, I've I've watched both of your guys' takes both on uh Matt, listen to your podcast, and I read all of your guys' tweets, and so I think you guys are directionally aligned. So, if there is any dislocation in your guys' opinions, uh I I would like to have you guys flag that, but uh Matt, what do you think about the idea of stretch trading back up to $100?

>> I mean, I guess anything's possible if you look at what they announced yesterday. Um I mean, talk about complicated capital structure here. Um number one is they announced a new US dollar reserve policy. So looks like they're up to 17.4 months of coverage. Um that's to service the preferreds and the indebtedness uh across the cap table. Number two is the stretch dividend. So they increased it to 12. I clearly trying to make a play to have people stay in that product. Um the third thing they announced is a digital credit repurchase program. So they allocate up to $1 billion in repurchases across the preferred stack. So yeah, could they repurchase it?

Could they drive the, you know, closer to 100? I could see that. Uh they also announced a common equity repurchase program for another billion dollars. And they announced a Bitcoin monetization plan for 1.25 billion that they could sell into US dollars. So could some combination of that push the prefers up?

Sure. Now, is it going to be a useful issuance platform in the future? I highly doubt that. >> The the thing about the what they announced uh is they announced a framework. A digital credit capital framework. It was not in plain. Can we just say in plain speak?

What what was that in simple explain like I'm 5 years old terms? Like I don't want to hear digital credit capital framework. What did they announce Matt? Look, so they had about what nine months of cash to service the preferreds. Market's freaking out. They need to either sell equity or they need to sell Bitcoin. Uh they sold common equity in size last week, over a billion dollars of common equity. And what they basically announced is that we're going to actively manage this balance sheet. We're going to seek to keep the preferred in the game. We're not going to sacrifice the preferred. I think Jeff's had some good takes around this trillemma here between Bitcoin, the common equity, and the preferreds. And I think it's really difficult to find an outcome that is beneficial to all three cohorts there. Um, but they basically announced, look, we're gonna try to manage these three constituents. Jeff, do you think that that is even a stable equilibrium for strategy, uh, the the three different investor bases, the MSTR equity investors, the stretch preferred investors, and then Bitcoin itself?

Is it possible to balance between these things? >> No. I mean, I think that that's 100% the problem with this company. I mean it's not it there's no trigger for it to go bankrupt here, right?

There's no forced liquidations of Bitcoin coming up or anything like that. The problem with this company going forward is simply that um each part of the cap structure is in a war with the other parts of the cap structure, right?

Everything that is good for one part or is ne is going to be negative for other parts. like there's just there's no way short of Bitcoin just mooning to 200,000 that all parts of the capital structure and [clears throat] really there's a fourth part which Matt didn't even mention which is the debt holders right which which you know are fully covered but that's coming due at some point in the next four years as well um you know with about a billion dollars of maturities and puts coming every year so there's four parts of the cap structure and and there's just no way to satisfy all of them what what I would say in layman's term you know what what they announced yesterday in layman terms is basically we are now an actively managed hedge fund we are going to actively, you know, it used to be all we do is sell stock to buy Bitcoin, right?

That was a simple story four years ago. Then it was, oh, we sell all kinds of things to buy Bitcoin. We sell preferred, we sell debt, we sell equity to buy Bitcoin. Then it was, well, sometimes we might have to sell some Bitcoin. And now it's basically everything we can sell uh or buy, right?

So, it's like every single part of their cap structure, we may sell or buy. We may sell more debt. We may buy back the debt like they've already done. We may sell more equity. We might buy back the equity. We may sell the preferred. We may buy back the preferred, we may buy Bitcoin, we may sell Bitcoin. Right?

They're basically saying, we are now an actively managed hedge fund. And all we're going to do is look at the fact that all four parts of this capital structure are literally at war with each other and we're going to take advantage of that and try to monetize that volatility uh that they created for no reason. [clears throat] >> Jeeoff, you bring up the the per uh the converts and I they were silent on that front. I mean, how easy do you think it's going to be to get them to um to refinance these converts?

6.7 billion in maturities over the next couple years. >> Yeah, I actually think it's pretty easy. Um, you know, as a former debt capital markets investment banker, um, you know, the joke with all convertible bond buyers is they're not real debt investors, right?

Real debt investors look at covenants, they look at the docks, they're very into the weeds in terms of what you're getting. Convertible bond investors, they don't care about the underlying company. They don't even care about the credit really. They care about the