Michael Saylor Says MicroStrategy Does Not Need to Sell Their Bitcoin

Michael Saylor, founder and CEO of MicroStrategy, a business-intelligence software firm took to Twitter Tuesday morning to clarify his company’s stance regarding Bitcoin and its Bitcoin-backed loans. 

“MicroStrategy has a $205M term loan and needs to maintain $410M as collateral. $MSTR has 115,109 BTC that it can pledge,” Saylor tweeted. “If the price of #BTC falls below $3,562 the company could post some other collateral. See slides 11-12 in Q1 2022 presentation. #HODL”

In other words, Bitcoin would need to drop to $3,562 before the company would need to consider other options. The remainder of his tweet also suggested that even if the price of Bitcoin did drop that low, they wouldn’t be forced to sell their Bitcoin, rather they would just need to post other assets as collateral. Furthermore, the price of Bitcoin hasn’t been sub $4,000 since March of 2019. 

The quick downward spiral in the crypto market ramped up rumors that MicroStrategy would face a margin call. Even the outgoing CFO Phon Le said on the company earnings class last week if Bitcoin dropped to $21,000 they would potentially need to sell. However, he noted that adding more Bitcoin to the collateral package could solve that issue. 

The Saylor tweet clearly indicates that the company does not have to worry about the price of Bitcoin further plunging to warrant a margin call. Clearly, there are some untapped funds Saylor could go to, to add to the collateral package whether it be Bitcoin or something else. 

Bitcoin is currently being traded at $31,078, which puts the digital asset down 4.75% in the last 24 hours, according to Bitpush Terminal data. However, this is not the lowest price in the last day, as it was in the low $30,000s Monday night. 

MicroStrategy shares dropped nearly 26% yesterday and has continued to do so Tuesday, down 3.16% at the time of writing. 

Author: Tyler Irvin

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