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March 15, 2022

Michael Saylor Explains Why His Company Adopted Bitcoin

Michael Saylor has become a household name in the crypto space as a result of his unwavering support for cryptocurrency. Yesterday, the CEO of MicroStrategy explained why his company has been aggressively adopting Bitcoin over the last year.

Michael Saylor is a well-known Bitcoin promoter who has become more vocal about the primary digital asset since 2021. Yesterday, at the Economic Club of New York meeting, the CEO of software company MicroStrategy explained why the company turned to crypto, specifically Bitcoin.

The executive stated that his company was facing two financial risks at the time: the first was what he called a quick death from the technology space, and the second was a slow death from the increasing fiat supply highlighted by the pandemic.

According to Saylor, the firm chose Bitcoin as an inflationary hedge due to its ability to produce returns comparable to real estate.

While gold is widely regarded as a traditional inflationary hedge, he claims it cannot be developed or rented in the same way that real estate can. He admitted that he preferred real estate to gold, calling it a better idea. Saylor explained that by staking Bitcoin, you can earn returns comparable to rent, and you can always carry it with you in your digital wallet in times of conflict. He pointed out that real estate lacked this ability to transport it.

He expanded on this, demonstrating that properties in Ukraine and Russia were under threat as a result of Putin’s war effort, a risk that a digital asset like Bitcoin is unlikely to face. Taylor asked, “Where can you go if your property isn’t safe outside your country and it’s not safe inside your country?”

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It would not be the billionaire’s first time making such comparisons. He stated on the PBD Podcast less than a week ago that he believed Bitcoin was the only true scarce asset. Saylor pointed out that the supply of all other assets or commodities could always increase, citing companies’ ability to create more real estate, bonds, and stock shares.

Saylor remains convinced that Bitcoin is a high-risk investment. For example, the executive stated in a tweet at the start of the Russian invasion, “Wars create inflation, cripple commerce, and make bitcoin compelling.” Indeed, as a result of the conflict, there has been a significant increase in Bitcoin trading activity in Ukraine.

However, Saylor’s view of Bitcoin as a risk-off asset is not shared by everyone. In recent months, the crypto market, including Bitcoin, has been highly correlated with traditional equity markets.

Bitcoin is currently trading at around $39,061 on major exchanges. The asset is up 0.11 percent in the last 24 hours and 0.74 percent in the last seven days, according to CoinMarketCap data.