0:00 spk_0

Michael, so good to see you right off the jump here. Look, we had Bitcoin hit a record high just a few weeks ago, $126,000. We’ve seen this pull back here over the past few weeks. I look at strategy stock down about 27% over the past month. Are investors losing faith in the Bitcoin movement?

0:20 spk_1

No, I don’t, I don’t think they’re losing faith. Um, if you’re an investor, uh, it really comes down to what your time horizon is and how much volatility can you stomach. So if you want max performance, you’re gonna take max volatility, uh, strategy up 75% a year on average for the last 5 years. So you can actually outperform Bitcoin if you buy, uh, an equity that’s amplified like uh MSTR.If you don’t want to trust anybody, you want no counterparty risk, you buy Bitcoin. Bitcoin’s up 50% a year over 5 years, no counterparty risk. It’s very straightforward. If you want to have your cake and eat it too, you could buy some convertible preferred like uh STRK. STRK will get the ball, yeah, the VA on MSTR is like 6070. The ball on Bitcoin is 45. STRK would get your ball to like high 20s.And you get a mixture of a dividend and principal protection and and some of the upside of the common equity. And if your time horizon is less than 4 years and you don’t have much volatility to stomach, you shouldn’t buy the equity or the equity hybrids. You should buy the credit something like STRC.You know, STRSC is, is meant to be very, very stable, around $100 plus or minus a few pennies, and you get like a 10 and 10.5% uh dividend, you know, that’s tax deferred and you’re, you’re getting the benefit of the crypto.Economy, but you’re not on the volatility roller coaster, so everybody’s got different risk tolerance. They’ve all got different pools of capital. The good news this year is now you’ve got a variety of different instruments you can use to ride the digital wave,

2:07 spk_2

Michael, and as we’ve gotten more instruments to ride the digital wave, particularly as people have had more and more ways to directly invest in Bitcoin.strategy stock has not done as well, to your point, it has over the past several years, but again, if you’re talking about getting in now or if you got in earlier this year, you wrote it down even as Bitcoin was going up. Are you concerned at all that the the crypto treasury, the digital asset treasury strategy that you pioneered is losing a little bit of steam?

2:40 spk_1

You know, over the last year there’s been 100 companies that have added Bitcoin to their balance sheet. The derivatives market, and IID has surged. The flows into the ETFs have surged. All the major banks have announced support. Uh, the accounting has dramatically improved. The tax regime has improved. The administration support at the SEC, the CFTC, the Treasury level.Has improved and so uh and the technology has improved, you know, uh companies like uh like Block have rolled out support for Bitcoin on Square and Cash App. So all the fundamentals are good if you’re gonna be an equity investor, you have to think for yourself and you have to have a time horizon of 4 years or longer, and equity markets are either gonna lead or lag and and occasionally they’ll perfectly reflect reality, but generally.It’s only a few days a year when they’ll be perfectly rational. So if you don’t have that 4 year time horizon and if you don’t want to make decisions based on fundamentals, if you, if you simply want to park your money in a stable instrument and pick up a stable yield you should be a credit investor, you shouldn’t be an equity investor. I think the irony is, is the fundamentals of the industry are so much better today than they were 12 months ago.That you’ve now got an extraordinary risk reward opportunity. Now is a much better time to invest. You know all the things that you wanted to happen have happened. The market sentiment is negative, but that’s, that’s an opportunity for the equity investor that makes their own decisions.

4:18 spk_0

Michael, you’re a, look, you’re seen as a pioneer in this industry, uh, charting new territory in cryptos and, and Bitcoin. What do you think about the likes of Jim Chenos and others like him that are trying to profit off of you not doing so well?

4:34 spk_1

You know, I don’t really think about Jim Chanos. I think that there’ll be some skeptics. They don’t really appreciate what Bitcoin is doing. They don’t understand digital capital. They don’t understand digital credit, but at the end of the day, the big, the big, uh, dynamic in the industry is digital capital has gone from 0 to $2.5 trillion over 15 years.Digital credit didn’t exist 12 months ago. Uh, we’ve issued nearly $8 billion of digital credit. Digital credit is got a tax equivalent yield of 4 times higher than bank credit. You know, you can have a bank account, you know, in New York City that pays you 4% and it’s taxable or you could buy something like STRC that pays you 10.5% that’s tax deferred.So that the market’s evolving, uh, and the short sellers aren’t really interested in the impact of AI or the impact on digital assets to change the way the world works uh they’re just interested in being skeptical as a business. I, I don’t really focus on them. No, nothing great has ever been created by a short seller.

5:48 spk_2

Um, Michael, you’ve referred a couple of times to this new digital asset credit that you guys have developed STRC Stretch. It’s a preferred security that, as you mentioned, pays out 10.5% in yield, and this is also a way for you all to not necessarily.Issue more stock in the underlying equity in order to pay for buying more Bitcoin and therefore maybe not diluting those underlying shares as much um but how far do you think you can take that as sort of a funding mechanism for your Bitcoin strategy?

6:22 spk_1

Well I think the money market industry is massive. There’s $30 trillion worth of assets invested in Treasury type instruments in the United States stretches about 11% of 1% of that industry. It’s about a $3 billion issuance, uh, and, and the big idea here is you take an asset appreciating 50% a year with a volatility in the mid-40s.And you strip the volatility from 45 down to below 5 maybe to to 23 or 4 or even 1, and then you extract about 10% dividend yield and if you do that you end up with something which is yielding 6% more than the risk free rate.And when the ball gets to 1, you’ve got a sharp ratio of 6 so we’re really, uh, engaging in financial engineering to distill pure, uh, currency yield above the risk-free rate and of course the common stock shareholders and MSTR get the difference between the 10% that we pay and the 50% the Bitcoin’s been performing, uh, long term.The math is pretty simple. We expect Bitcoin to appreciate about 30% a year for the next 20 years. We expect to pay about 10% dividend yield on the preferred. 2/3 of the benefit goes to the common equity shareholders, and most of the volatility is stomached by the common equity shareholders and the corporation.And the credit investors get this pure 10% return of capital dividend that means it’s tax deferred. They don’t have to pay tax on it until they sell the underlying instrument, and that means that they’re able to invest in a credit instrument that pays them a 10% dividend instead of holding a money market that pays them 4% in a taxable coupon.

8:22 spk_0

Michael, of course we’re having this conversation the day after the government shutdown officially has ended. Things have to restart up again, but still record setting shutdown. What did you think about the length of the shutdown, and do you believe it reinforces your long term view on Bitcoin and various other cryptos because look at the end of the day, record setting shutdown. I mean how can you have trust in the dollar?

8:44 spk_1

Well, you know, we, we joke there’s no tariffs on Bitcoin. Bitcoin has no employees. It’s got no corporate headquarters. It is, it is an index reflecting the digital economy or the global digital economy. So if you just like to buy 121 million of the global free market, then you buy one Bitcoin.Uh, as people lose confidence in a currency in Africa or South America or Asia, as they lose confidence in the government, if they think that their favorite company might make a mistake.Uh, war, famine, pestilence, fire, flood, uncertainty, acts of God, all of these things are risk factors, and they’re all risk factors that Bitcoin doesn’t undergo and doesn’t experience. So, so as people get educated, I think they can see the appeal of buying digital capital instead of investing their money in.Equity capital or real estate capital or fiat capital or corporate credit capital instruments and so this is all a teaching moment, but I think that every single month that goes by, more and more people start to appreciate the benefit of owning 121 millionth of all the money in the world forever.

10:07 spk_0

Michael, do you think, uh, in light of the shutdown that investors have lost faith in our country?

10:15 spk_1

No, I don’t think they’ve lost faith in our country. I think the country is going to do just fine. This is a hiccup. It’s, it’s not our fine’s finest moment, but right now the exciting things that are going on are digital intelligence, digital assets, digital capital, digital credit.It’s pretty clear that money’s going to move at the speed of light. It’s pretty clear that a billion AIs are gonna think a billion times faster than us human beings. You can see a world where a billion robots are going to build everything we need, where the cars are going to drive themselves, where the products are gonna figure stuff out for us. So we’re moving toward an intelligent world that is is millions of times more efficient and, uh, and more empowering, so.In a world where a billion robots do everything I want before I think to ask for the thing, I don’t know how I won’t be better off.

11:09 spk_2

Michael, is there a risk that some of those robots or perhaps quantum computers combined with generative AI that they crack Bitcoin or that they think of something better than Bitcoin and it becomes obsolete?

11:24 spk_1

No, I don’t think there is a risk. I think that technology will improve and hardware will improve, and at some point if the hardware gets more powerful, we’ll have to upgrade the software that protects our system. So just like you can expect your bank to upgrade their software and you can expect to upgrade your Apple software and your Google software and your Microsoft software.And you can expect to upgrade your hardware devices. I’m on the iPhone 17 Pro Max right now. You’ll upgrade your computer. Bitcoin is a protocol, but it runs on hardware and software nodes all around the world. The hardware is being upgraded every few months. The software is being upgraded annually, and so the software and hardware that runs the Bitcoin protocol is going to get upgraded just like your Apple and Android and Microsoft software will get upgraded.

12:16 spk_2

I was gonna say Tim Cook’s sending you a check in the mail, but I guess now Microsoft and uh and and Alphabet have got to send you a check too because you mentioned all those. Um, let’s, let’s talk a little bit about the, the bigger market because of the AI advances that you’re talking about. Uh, you know, you’re very familiar with the dot-com bubble, right? Because you founded MicroStrategy in ’89. You went public in ’98. Um, I was looking at the history of the stock chart here.You went public at $12 a share. The stock at that time spiked as high as 313 in 2000 and then crashed down or remained below 20 until you initiated your Bitcoin buying strategy. I’m curious, you know, as you look back at that crash, what that taught you and whether you see any parallels today, obviously you’re aware of the big bubble debate going on right now.

13:03 spk_1

Uh, I think it teaches you to focus. Um, don’t overextend. Uh, you might have 10 good ideas, but you’re better to focus on your one idea and to commercialize the one idea. It also just reminds you that no matter where you are as a corporation, you can always improve uh the company’s outlook, and you can improve and create shareholder value by harnessing the next wave.People wrote off Apple for dead. I mean, Michael Dell famously told uh Apple to shut down and give the money back to the shareholders back around ’97, and then Steve Jobs returned and he harnessed the internet and then he harnessed MP3 files and, and digital music in order to revive Apple and then eventually created a crazy thing called the iPhone and it became the most valuable company in the world.I think history is replete with examples, you know, whether it’s the internet or whether it’s AI chips, uh, people, you know, people wrote off GPUs as being irrelevant and all of a sudden we have the chat GPT moment.Uh, the Bitcoin miners were struggling and then AI explodes and now everybody wants their energy. Um, I, I think, uh, that digital intelligence, digital assets, digital capital are creating the most compelling opportunities for corporations in the world today, um.I think the important thing is to use them the right way. For example, we used AI in order to design those five digital credit instruments, so people ask how do you make a billion dollars with AI? Well, we, we created $8 billion with AI just by designing new types of securities. Yesterday, STRC traded $175 million. It’s the most successful preferred stock.In this in the century, maybe ever in the history of the capital markets, uh, it was designed completely with AI. It’s a 100 times better than a good preferred stock. I, I would encourage anybody with any corporation to to think about how, how you turbocharge your company by using digital assets, digital currency, digital capital, or digital intelligence.There isn’t a company that you can’t improve using technology in the year 2025.

15:26 spk_0

Michael, later on in the in the program, I’m going to be sitting down with Eric Trump and Asher Gnu. They’re of course working American Bitcoin and 88 mining those operations for American Bitcoin, and I know they’re very focused on power generation. As you look at your long term outlook for Bitcoin and other cryptocurrencies, how concerned are you that this country can’t produce the power it needs to meet the demands of cryptocurrency?

15:50 spk_1

You know, I, I think the company got a wake up call back in 2020 and 2021. I talked to a lot of power companies and energy companies, and they were about to decommission all their nuclear reactors. We, we were staring at all the nuclear reactors getting decommissioned and there was a movement to shut down nuclear energy in this country and of course in Germany they shut them all down from 19 early 1970s, 73, all the way till 2023.Uh, the nuclear industry was persona non grata and it was politically incorrect, and I think the explosion of AI and when people started using these AIs and realized they’re actually quite useful and they’re transformational, it created, uh, it, it created a reconsideration and a and a political shift in in the United States. The Overton window shifted.And, and as soon as Google and Microsoft and Apple and Amazon realized they needed energy, nuclear became cool again.And we flipped from 50 years of not wanting to build power, whether it’s nuclear or natural gas was out of favor too. People wanted to shut down natural gas. All of that changed in the past two years, and now, now the political sentiment in this country is we should uh develop natural gas. We should develop nuclear power.And of course we’re only about 1 to 2 years into that uh sentiment shift, but I have confidence that the United States is going to move from a laggard to a leader in the energy generation business because now we see we need the energy to drive our cars, we need the energy to power up our robots, we need the energy to think.billion times faster, a billion times quicker, and we need the energy to defend our digital assets like the Bitcoin network and the only thing that was lacking was the political will and I think that has flipped 180 degrees. There’s not, there’s bipartisan consensus. There’s not even a debate right now about whether we should generate more energy or build more power plants. 4 years ago.You couldn’t have done it and so I think we’ve been saved by the explosion of digital intelligence and digital assets in this country. It will be good for the nation. It’ll be good for the world.

18:15 spk_2

Michael, um, obviously you’re a serious guy, right? We’ve talked a number of times. You think very deeply about all these issues, but then sometimes I look at your X account and I see you posting or reposting these various sort of digitally generated images, AI generated images of yourself. They’re a lot of fun, right? of you. We’re showing one of you in a top had various Bitcoin paranalia, superheroes, etc.Like, uh, you know, I’m just curious how you think about that is that, you know, is, is your Bitcoin, um, you know, advocacy, is there an element of shtick to it as well? Are you having a little fun with it? How do you think about all of that?

18:57 spk_1

You know, when I was growing up there were 3 channels on television and they turned off the television, uh, the signal at like 11 o’clock at night or or midnight and for 8 hours there was no programming. There was no internet. Uh, we didn’t have today we have infinite free music, infinite free television, infinite streaming video, infinite free YouTube. You can get lost fall in a TikTok hole and Instagram hole. You can get on stream.Uh, and Twitch, uh, there is we have managed to manufacture infinite everything. Uh, it used to be you had to have money to get a newspaper or a magazine, and now you can see we live in a world where we have, uh, to say a million times more content would be probably an understatement. So the entire society is being inundated with information and their attention span has shrunk.And so people just don’t have an hour to listen to what you have to say. They don’t, uh, they sometimes they don’t have a minute. Oftentimes I think, you know, should I say it in a podcast? Well maybe someone will listen to it. Can I say it in 5 minutes? That might be too long. Can I say it in 30 seconds? Sometimes I’ll write a paragraph and you think, you know, I don’t have a paragraph. People will read the first sentence.And I write the sentence and I think people aren’t gonna read to the end of the sentence and so uh the, the thing you learn from social media is you need to get to the point. So how about tell me what you want to say in one second.And the cliche is a picture is worth 1000 words and so sometimes I don’t give you 1000 words because you would lose 99.9% of the audience. In fact, I would say you probably lose 99.99% of the audience. If it took 1000 words, show me the picture and that will go viral and, and you’re doing people a service to give them an idea that travels a million times faster.That is a million times easier to digest because people just don’t have time they’re busy they’re being inundated and and when you see those images that is us communicating something cheerful, constructive, useful, perhaps profitable to someone.But you know, like, like if someone says, hey, I wrote a book on this, here’s the book. Do you want to read it? I mean, how many books can you read? You know, literally every book written in the history of the human race is available for free to you right now. Do you really want someone with a good idea to give you 250 pages and tell you to read it, or do you just want them to boil it down to one.Sentence one tag line or one picture because I’m like show me the picture. OK, got it now I can move on with my life. Thank you.

21:52 spk_0

You’remaking a lot of sense to me, Michael. Uh, stay with us for a second. Let’s bring in our social correspondent for the day. Y’all Allie Canal with some of what she’s hearing from our online audience during this interview. Ali.

22:04 spk_3

Now Brian Michael Saylor just talking about infinite content on social media, which is the perfect segue. Since we are talking and taking your questions on social media, plenty of viewers chiming in and starting off with a strong one here, Michael. First question, do you see Bitcoin catching up to and surpassing gold’s market cap by 2035? What say you?

22:25 spk_1

I do. I think we’re in a Bitcoin. We’re in the digital gold rush, and 2035 is the 0.99 year. That means that 99% of all the Bitcoin will have been mined in the year 2035. There’s only, there’s if you want Bitcoin, you need to get it between now and then because the last 1% of Bitcoin comes out over 100 years. Um, yeah, there’s no doubt in my mind Bitcoin will be a larger asset class than gold by the year 2035.

22:56 spk_3

And another social viewer wants to know why should an investor buy strategy stock instead of a Bitcoin or spot ETF.

23:04 spk_1

Yeah, um, if you don’t want to take any counterparty risk and if you have a long time horizon, then you should probably buy the Bitcoin, uh, because you can take custody and take it anywhere in the world. Um, if you simply want the asset, you want it in a brokerage account, you should buy the ETF like IBIT. It’s, uh, gonna take you 10 seconds to do that. It’s easy to borrow against it.Um, if you’re a believer and you want amplified exposure to digital, uh, to digital capital and also if you believe in digital credit, like our mission and strategy is we want to give a billion people a bank account that pays them 10% tax deferred. If you think that’s a cool idea to give someone in Japan or Europe or Switzerland or New York City a bank account that pays them 10% with no volatility, and if you think that Bitcoin can power that.Then you’re buying our stock because we’re a digital credit factory, and if you want to outperform Bitcoin and you’re ready to get on the roller coaster, you should, uh, you should buy the equity. But if you’re, if you’re short, your time horizon is less than 4 years, if you need the money back in 4 weeks or 4 months.Then you probably want something principal protection protected. You want low volatility. You should buy a credit instrument like STRC is literally designed to get the ball, you know, down right now it’s 7, whereas Bitcoin’s vol is 45 and strategy’s vol is 65, and if you want something that’s gonna be extremely low vol, you should buy a credit instrument like a Treasury credit product like STRC.You’ll, uh, you’ll outperform your money market, you know, you might very well do as good as the S&P index, but you’ll be able to buy it and sell it and get your your capital back, you know, in a, in a month and a quarter in a year, and you don’t have to, you know, worry about the roller coaster.