STAY ALERT
As a $BTC HOLDER, we all want to believe our investments will be rewarding in the long run, that our units are appreciating because of its intrinsic value.
Holding "forever" and trading for profits require opposite attitudes towards investing.
Assuming a TREASURY is a reserve and not an inventory, one could expect the hoarding has a purpose more than turnover (purchases/sales for profit).
One must consider the speculative value of a "promising" asset and be concern with the risk of an asset of becoming overvalued.
A startling misconception that the public is taking for granted is the HODL stance of corporations, and the Supply Shock that will drive the price by multiples in the near future.
It is true that:
Markets can stay irrational longer than you can remain solvent.
John Maynard Keynes.
Even if BTC has a real potential, the market is probably discounting years of organic growth.
What is worse, is that major corporate investments in BTC will not be long term commitments. Regardless of the conviction (real or not) of their management, there are many situations that will force any of them to liquidate their BTCs, specially insolvency and possibly bankruptcy.
The awe people have towards Strategy and companies such as Metaplanet is irrational.
They are not TERIFFIC companies. They are TERRIBLE companies.
No matter how much hype surrounds their BTC purchases and the performance of those treasuries, they are issuing ever growing amounts of low quality debt just to keep the illusion they are solvent while they are not.
Seriously, Have anyone seen their financials before praising them ?
In short, their revenue is minuscule compared to their debt burden (debt they cannot repay not even with 50-100 years of earnings), and BTC represent more than 90% of their NAV (net asset value). It means, their respective valuations are given by BTC speculation. They rely entirely in the appretiation of their treasuries in order to repay investors when the bonds they issued reach maturity.
What will happen if they cannot meet their obligations?
If they default, BTC existences will be auctioned to other financial institutions such as banks or funds, and the future of the price of BTC would be in their hands.
Metaplanet was practically dead before it annouced issuance of corporate bonds to finance BTC purchases. So was Strategy, so were and are the others copying the alpha.
Strategy Copycats are cornering the market, by pushing the price higher and higher in a bubble like fashion on credit that must be eventually repaid.
Bitcoin can survive without them, if it manages to be disassociated from the debacles of opportunistic ventures.
However, if no one takes the leadership position these corporation have, public sentiment could be shaken forever.
Meanwhile, real players such as BlackRockā¢, aware of the risk, sold part of its BTC (reducing exposure), and diversifies its crypto offerings with ETFs for ETH and probably others soon, such as SOL and XRP
