Sold at 60,000 and bought back at 80,000: this crypto-hoarding giant’s CEO says both moves were right
The whole internet was laughing at the buy-high-sell-low move, and the main character came out to explain it himself.
This summer, the crypto-hoarding giant sold about 7,000 bitcoins in the 60,000 to 65,000 range.
Then at the end of August, it spent another $369.7 million to buy back 4,603 bitcoins at an average price of $80,318.
Going back and forth like that, it ended up with an unrealized loss of about $125 million on paper, equivalent to the buying power of about 1,500 coins.
In a Bloomberg interview, the CEO said both trades were the right call.
Selling coins was to pay dividends on preferred stock, turning coins into cash without diluting equity.
Buying coins was done by taking advantage of a stock-price premium, raising funds by selling shares, and then converting that into Bitcoin.
Their decision anchor is the cost of capital, not whether the coin price is high or low.
More importantly, there’s the result of the ceasefire period.
The company brought net debt down from about $7 billion to zero and accumulated about $7 billion in cash.
The CEO’s exact words were: a balance sheet that bullets can’t pierce.
Zero debt plus massive cash means it never has to be forced to sell coins.
The numbers really do say something.
So far this year, it has bought about 175,000 coins and sold only 7,000, a buy-sell ratio of 25 to 1.
So-called selling high and buying low is just a tiny bit of position turnover.
It now holds 845,000 coins in total, with an average cost of $75,412 and unrealized gains of about $3.6 billion.
At the start of the year it was still down more than $10 billion, and in just six weeks it turned green. For every $1,000 move in the coin price, the paper value swings by $845 million.
Retail investors watch price levels; giants watch structure. That’s the difference in perspective.
Do you think this is a real expert move, or just tough talk? Chat in the comments.
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