He invited Venezuelans to put hope in cryptocurrency and believe that their life will be better
The executive revealed the strategy implemented by MicroStrategy so that volatility does not affect him.
Michael Saylor believes that people will improve their lives with bitcoin in his hands, and Venezuela does not escape it, even though it has remained immersed in the nightmare of hyperinflation since November 2017. This was expressed by the CEO of MicroStrategy this Friday, July 2, in the video podcast Let’s talk about Bitcoin produced by the Satoshi organization in Venezuela.
“If everything you create drains and you lose it, then you have no hope, but if you want to reverse that, people need to make use of the ability to store their economic energy, which they can do with bitcoin that is under their own control. They should not wait fearing that a banker, a politician or an executive will do something and ruin everything by making them lose their savings,” said Saylor when Javier Bastardo, the conductor of space, asked him: how do you think the cryptocurrency pioneer could become hope for a country like Venezuela?
The CEO of the company softwarewhich plans to sell up to $ 1 billion in shares to continue buying bitcoin, he believes the next few decades will focus on the digital transformation of ownership, precisely what the world already has with bitcoin.
He is therefore convinced that instead of buying gold, land, collectibles or storing his money in the bank, what people need to do to preserve the value of their assets, is put their property in bitcoin. An alternative that exists today to be easily managed just from a mobile device.
The reason bitcoin represents hope for the world is that 8 billion people can pay through a mobile device. That’s because Bitcoin is like a bank in cyberspace run by software incorruptible that offers everyone a simple, secure and affordable savings account. With bitcoin everyone can deposit and keep their money and that is why it is good for Venezuela. Although in reality all economies work better if they have an incorruptible bank that allows everyone to store their monetary energy and gives back rationality and long-term perspective. Hope is to believe that in a decade your life will be better than it is now.
Michael Saylor, CEO of MicroStrategy.
Don’t trust fiat currencies, bitcoin is your best ally
Bitcoin is already transforming the lives of many people in the world, but countries facing economic crises like Venezuela, Colombia, South Africa, Nigeria, Kenya and others are at the top of the crypto asset adoption ranking. That is why Bastardo asked Saylor if he believes it is a condition that populations are affected by the devaluation of their national currencies to accept bitcoin.
Saylor’s response revolved around what could be understood as the emergence of a new economic order, which will not be possible to appreciate in the short term. From your perspective, turning to the dollar to preserve value can be a solution for one and up to three years. But it will not be a good decision in the long term, for a period of a decade, for example.
“You will not be able to retain value with the dollar, you will need to turn it around with a stronger asset and for me that asset is bitcoin. I see that Bitcoin is stored value, while the US dollar is a means of exchange, ” he added.
But if you store so much bitcoin how is volatility not affecting you? asked Bastard. That’s when Saylor revealed the corporate strategy implemented by MicroStrategy not to be affected by the intense fluctuations in the price of the cryptocurrency, given that it is the public listing company with the largest holding of BTC in the world, with more than 92,000 bitcoins in its coffers.
We are a company that needs 500 million dollars a year. So we’re dealing with a current account on the order of the $ 50 million we keep with a medium of exchange that is the U.S. dollar. Then when we generate cash flows or have extra money coming from equity, debt or cash flow, we put it in our treasury and as a treasury strategy we use bitcoin. We don’t use dollars because you are losing between 15 and 25% of its value per year, while the value of bitcoin increases every year. Basically, we are converting our working capital from the weakest asset to the strongest asset.
Michael Saylor, CEO of MicroStrategy.
So the way MicroStrategy handles volatility is by making sure you have enough dollars to pay for the company’s expenses over the next 12 months. This with the idea of having a margin of action and not having to liquidate their holdings in bitcoin when the market is bearish and the cryptocurrency loses value.
As Saylor commented, by accumulating more and more bitcoin, the projection of the company it is focused on the gains you will make within a decade, not in the short term. “If you have that macroeconomic vision, along with the technological vision and a decade-long time frame, then it’s not that risky. It becomes risky if you deal with bitcoin in a short period of a month, ” he added.
The executive recommended that the inhabitants of Venezuela and other parts of the world implement the MicroStrategy strategy in their lives. Protect themselves from volatility taking the amount of money they need for the next year and keep it in dollars instead of bolivars. “Then if you have money you don’t need in the next 12 months, then you can start investing in bitcoin,” he noted.
Recently, as reported by CriptoNoticias, MicroStrategy made a new purchase of bitcoin and now its treasury its treasury exceeds 100,000 BTC. In this way, MicroStrategy consolidates as the company with the largest accumulation of bitcoins, leaving companies like Tesla (42,000 BTC) Galaxy Digital (16,000 BTC) and Square (8,000 BTC) far behind.