Michael Saylor sees Bitcoin as a safe haven, despite $1.3 billion decline

• The value of MicroStrategy’s bitcoin holdings fell by $1.3 billion during 2022, the earnings report showed.
• But the company has no plans to sell more of its crypto, co-founder Michael Saylor said Thursday.
• “The only real safe haven for an institutional investor is bitcoin,” he said on an earnings call.

MicroStrategy co-founder Michael Saylor remains bullish on bitcoin as a digital “safe haven” for investors — even though his company suffered losses of nearly $1.3 billion on paper from holding the cryptocurrency last year.

The software company posted a net loss of $1.47 billion for the year in its earnings report published after the close Thursday. The report showed that MicroStrategy – which has been loading up on bitcoin since August 2020 – has lost money for eight consecutive quarters.

But Saylor said he still believes in bitcoin as a so-called safe haven, meaning he believes it is an asset where investors can park their cash during times of high volatility.

“The only real safe haven for an institutional investor is bitcoin,” he said on an earnings call. “Bitcoin is the only universally recognized digital commodity, and so if you are an investor, bitcoin is your safe haven in this regard.”

Bitcoin’s price plunged 64% last year as rising interest rates and the implosion of high-profile companies like FTX weighed on digital assets. MicroStrategy stock fell 74% over the same period.

Impairment charges account for assets that have lost value over the time a company has held them, and MicroStrategy recorded $1.29 billion worth of write-downs on its bitcoin holdings in 2022.

The company has bought 132,500 bitcoins over the past two and a half years as part of an unconventional strategy to convert all its cash into the cryptocurrency. It has only sold bitcoin once in that period, offloading $11.8 million of the token in December for tax reasons.

MicroStrategy shares were trading 4.7% lower in premarket Friday, but have jumped 117% since the company began buying bitcoin. This means that the stock has outperformed the benchmark S&P 500, the technology-heavy Nasdaq Composite, and even the token itself.

“As we think about the corporate strategy and its effectiveness, we go back to the summer of 2020,” Saylor said.

Noting that MicroStrategy’s stock had outperformed since then, he said the company measured its success based on the creation of shareholder value.

“We pick a number of different benchmarks, I think the most important one is bitcoin’s performance. No one who talks about bitcoin points out that despite its volatility, it’s the best-performing asset over the last two and a half years. MicroStrategy stock is leveraged against bitcoin.”

Read more: MicroStrategy did exactly what CEO Michael Saylor once said would never happen: it sold bitcoin