The #1 reason bitcoin is down right now is a NOTHINGBURGER!

The number one reason Bitcoin is down right now is a nothing burger. A nothing burger is a burger with nothing inside. It means something that has nothing. Okay, so what happened? Well, Michael Sailor, who runs Strategy, the company, used to be called Micro Strategy, now just called Strategy. The ticker symbol on the stock market is MSTR. That company sold 32 Bitcoin. I think it was Friday of last week or maybe it was Monday of this week. Anyway, they sold 32 Bitcoin. 32 Bitcoin out of more than 843,000 Bitcoin. Now, on a video, I tried to do math in my head and was like, that’s like 12,000th of their Bitcoin. It’s less than that. It’s less than 12,000 of their Bitcoin. In fact, it is less. It is only one out of every 26,366 of the Bitcoin they own. So, why did they do it? Why did they create panic in the market by selling a ridiculously small amount of Bitcoin for a company that owns 843,000? And the answer is because the credit ratings agencies which determine whether Micro Strategy, the company strategy can get in the S&P 500, whether they uh what credit uh uh rating is assigned to their bonds, their preferred stock, all this other stuff. uh the credit rating agencies have been hassling them saying, “We are afraid that you are so in love with Bitcoin that even if your bonds come due and you owe other people money or you owe dividends and interest payments that you’re going to default on your bonds rather than selling a tiny amount of Bitcoin to pay the dividends or interest payments on their bonds or their preferred stocks.” So they told Michael Sailor, the CEO and founder of Strategy, the company, they said, “Look, you got to prove to us that you’re willing to sell a tiny amount of Bitcoin to pay dividends and interest payments. Otherwise, we’re not going to give a good credit rating to your bonds and your preferred stocks and all this sort of stuff because otherwise, we’re afraid you’re just so attached to that Bitcoin, you’ll never sell it no matter what.” So he said, “All right, screw it. I’ll sell 32 Bitcoin.” So he sold 32 Bitcoin uh in the same week that they raised $19 million for other purposes. So they sucked $109 million out of the market and only pushed 2.5 million back into the market in the form of selling 32 Bitcoin, which they were able to do some tax loss harvesting by doing that, which was, you know, a benefit. So um when you add all of that up, give me a second here. I’m in traffic. Um, so when you add all of that up, it was a very smart move. It enables him to get in the S&P 500 sooner. It uh increases the value of his uh preferred stocks and his bonds. It lets him get high credit ratings, and it proves to the marketplace that if he needs to sell a sliver of Bitcoin, in this case, 126,300th of the Bitcoin he owns, then he can sell 126,000 of the Bitcoin he owns, and the world will be fine. But of course, because people can’t do math, they have no idea how much Bitcoin that is, how much he has. Uh, you know, they panic panic and freak out and they’re like, “Oh no, the company with 843,000 Bitcoin is in trouble.” First of all, they’re not in trouble because they did it to prove that they could pay dividends and interest, but they don’t even have to pay the dividends and interest. either most or all of their bonds and preferred stock are structured where if they don’t want to pay the dividend, they can either defer it into the future or they can just not pay it with no consequences or it acrus at a higher interest rate. Basically, there’s a million different ways that they can not pay the interest payments or the dividends on their stock. So, one of those ways is STRC, which is their flagship product, and it has an 11.5% uh dividend on it. It’s a preferred stock, but they have the complete discretion to set that preferred dividend at any level they want, including zero. So, imagine, so here’s what it takes for them to actually get in trouble and be forced into selling Bitcoin. one, the first thing they can do is just zero out their preferred stock and zero out their bonds. So, you know, basically defer all payments. So, then they owe somewhere close to somewhere between nothing and close to nothing in the form of dividends and interest payment. They basically own owe almost nothing and then they can sell like 32 bitcoin uh you know to satisfy the you know the the the requirements to pay those dividends and interest payments. It’s like a ridiculously small amount. I don’t know what the number is, but it’s like some ridiculously small amount. So, the company strategy is fine. There’s nothing wrong with them. I I mean, it would take just an unbelievable combination of events for them to somehow end up in a distress situation forcibly selling significant amounts of Bitcoin. I mean, it’s almost statistically impossible. Again, unless they just decide to dump a bunch of Bitcoin to protect the dividends and interest payments on their bonds and preferred stock, which they don’t even have to make. Um anyway, so maybe that’s a problem if you own preferred stock or dividend or uh their bonds, but I’ve never recommended that you own Micro Strategy or Strategies Preferred Stocks or bonds. And the reason I haven’t is because they don’t have to pay make those payments. So I’m not going to recommend you buy something when they don’t even have to, you know, make the payments. Now, I think they probably will make the payments. Meaning, if I had to buy a fixed in income instrument from somebody, I would buy STRC, but that I don’t recommend that. I’m just saying if you got forced into that corner, I think they will probably pay those dividends and it’s a lot higher dividend than you can get for anything else in the market. Uh, but there’s no reason to do that because you can buy Bitcoin. And when you buy Bitcoin, you get all of the upside of Bitcoin. If you buy STRC, you only get 11.5% per year and the company gets all the other upside. So, Bitcoin goes up 40, 50, 70% in a year, you only get 11.5%. Which is why Bitcoin is a way better investment than STRC. But again, Michael Sailor is a genius. He structured everything where it basically is impossible for him to end up upside down on his Bitcoin holdings. And you can benefit right now for be by people being too dumb to be able to do basic math and figure out that the amount of Bitcoin he sold is completely irrelevant and that there’s effectively no way I can envision where the company’s strategy actually ends up in trouble. So, but it resulted in Bitcoin being on sale. So, good for you. You can buy cheap Bitcoin and you can thank all of the people who can’t do math and don’t understand what’s going on for selling you the cheap Bitcoin because they don’t know any better. So that’s what’s going on. Strategy’s not in trouble. Michael Sailor’s a genius. Nothing’s changed on that front. And so what? They sold 32 Bitcoin. It’s a complete and total nothing burger.