Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/microstrategy-inc-cl-a" target="_blank" data-smartkarma-citation="entities:14717:1" rel="noopener">MicroStrategy Inc Cl A (MSTR US)</a> is now trading at a ~26% discount to NAV as the bitcoin barbeque continues.  </li>
<li>Bitcoin is down ~40% YTD. If it falls another 24%, this will trigger a margin call on one of its loans.</li>
<li>Should bitcoin decline to US$17.5k, MSTR's crypto bet falls short of its debt obligation; debt that its software ops are not sufficiently profitable enough to service. </li>
</ul>



MicroStrategy Inc Cl A (MSTR US) is now trading at a ~26% discount to NAV as the bitcoin barbeque continues.  
Bitcoin is down ~40% YTD. If it falls another 24%, this will trigger a margin call on one of its loans.
Should bitcoin decline to US$17.5k, MSTR's crypto bet falls short of its debt obligation; debt that its software ops are not sufficiently profitable enough to service. 


MicroStrategy (MSTR US): Money From Nothing Is Worth?

<ul>
<li>
<a href="https://www.smartkarma.com/entities/microstrategy-inc-cl-a" target="_blank" data-smartkarma-citation="entities:14717:1" rel="noopener">Microstrategy Inc Cl A (MSTR US)</a> reported a net loss of $155.6mn in the fourth quarter, compared to the net loss of $124.3mn in the 4Q21. </li>
<li>MSTR took a non-cash digital asset impairment charge of $170.1mn in the first quarter, up from $146.6mn in the 4Q21. </li>
<li>A bet on MSTR is a bet on bitcoin. Yet MSTR is down 37% YTD, compared to ~20% for bitcoin. </li>
</ul>



Microstrategy Inc Cl A (MSTR US) reported a net loss of $155.6mn in the fourth quarter, compared to the net loss of $124.3mn in the 4Q21. 
MSTR took a non-cash digital asset impairment charge of $170.1mn in the first quarter, up from $146.6mn in the 4Q21. 
A bet on MSTR is a bet on bitcoin. Yet MSTR is down 37% YTD, compared to ~20% for bitcoin. 


Microstrategy: More Losses For Bitcoin Spruiker

<ul>
<li>
<a href="https://www.smartkarma.com/entities/microstrategy-inc-cl-a" target="_blank" data-smartkarma-citation="entities:14717:1" rel="noopener">Microstrategy Inc(MSTR US)</a><a href="https://www.microstrategy.com/content/dam/website-assets/collateral/financial-documents/press-release-archive/microstrategy-announces-fourth-quarter-2021-financial-results_02-01-2022.pdf" target="_blank" rel="noopener"> reported</a> a net loss of $90mn or $8.43/share in the fourth quarter, missing consensus estimates for a profit of US$0.89/share.</li>
<li>The loss is predominantly due to the inclusion of impairment losses of US$146.6mn on its Bitcoin holdings, negating the $110.5mn in gross profit from the software ops.</li>
<li>MicroStrategy remains a bet on Bitcoin. Yet almost any alternate cryptocurrency security appears a better bet, if that is your bent.</li>
</ul>



Microstrategy Inc(MSTR US) reported a net loss of $90mn or $8.43/share in the fourth quarter, missing consensus estimates for a profit of US$0.89/share.
The loss is predominantly due to the inclusion of impairment losses of US$146.6mn on its Bitcoin holdings, negating the $110.5mn in gross profit from the software ops.
MicroStrategy remains a bet on Bitcoin. Yet almost any alternate cryptocurrency security appears a better bet, if that is your bent.


Microstrategy's Unsurprising Bitcoin Loss

<div>
That trade worked out well.
In my note <a href="https://skr.ma/eEB66" target="_blank" rel="noopener">Microstrategy (MSTR US): "Crypto Through The Tulips"</a> back on the 28 June, I recommended shorting <a href="https://www.smartkarma.com/entities/microstrategy-inc-cl-a" target="_blank" data-smartkarma-citation="entities:14717:1" rel="noopener">Microstrategy Inc Cl A (MSTR US)</a> and going long bitcoin.
MSTR is up 2.3% since, against 30% for BTC.
MSTR has a tendency to issue paper to buy more bitcoins when the stock is at a large premium to its Bitcoin holdings.  As per its <a href="https://www.microstrategy.com/content/dam/website-assets/collateral/financial-documents/press-release-archive/microstrategy-acquires-additional-bitcoins-and-now-holds-over-105000-bitcoins-in-" target="_blank" rel="noopener">21 June 21</a> announcement, MSTR said it held 105,085 bitcoins. That figure remains unchanged.
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/228/764/original/image_1404123321631156413189.png?1631156418" class="editor-image img-responsive" data-smartkarma-image-id="228764"></figure>
MSTR's share price was US$123 prior to its initial announcement on the 11 August 2020 it was "adopting Bitcoin as a primary treasury reserve asset".
The current implied value for MSTR's stub ops - selling business intelligence software - is US$158/share, having touched US$141/share, suggesting value was emerging.
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/228/821/original/image_21363881771631163833057.png?1631163833" class="editor-image img-responsive" data-smartkarma-image-id="228821"></figure>
Yet is MSTR the ideal proxy for bitcoin? And just how much legitimacy should be attached to El Salvador giving bitcoin the status of legal tender?
More below the fold.
</div>


That trade worked out well.
In my note Microstrategy (MSTR US): "Crypto Through The Tulips" back on the 28 June, I recommended shorting Microstrategy Inc Cl A (MSTR US) and going long bitcoin.
MSTR is up 2.3% since, against 30% for BTC.
MSTR has a tendency to issue paper to buy more bitcoins when the stock is at a large premium to its Bitcoin holdings.  As per its 21 June 21 announcement, MSTR said it held 105,085 bitcoins. That figure remains unchanged.

MSTR's share price was US$123 prior to its initial announcement on the 11 August 2020 it was "adopting Bitcoin as a primary treasury reserve asset".
The current implied value for MSTR's stub ops - selling business intelligence software - is US$158/share, having touched US$141/share, suggesting value was emerging.

Yet is MSTR the ideal proxy for bitcoin? And just how much legitimacy should be attached to El Salvador giving bitcoin the status of legal tender?
More below the fold.


Microstrategy (MSTR US): Bitcoin's Mainstream/Fringes Balancing Act

Latest News from the World’s Leading Innovators

Granite Bay Capital

An innovation focussed investment company

Granite Bay Capital is an innovation focussed investment company with a deep focus on the companies at the leading edge of innovation across major themes such as AI, ubiquitous computing, sustainability, automation and longevity.

Thematic (Sector/Industry)

Headline developments are all up in the air this week, starting with United Airlines (UAL) who have signed an agreement with Boom Supersonic (private) to add 15 of their $200m jets to the fleet, with the option of adding an additional 35, after certain safety, sustainability and operating metrics are met.

Headline developments are all up in the air this week, starting with United Airlines (UAL) who have signed an agreement with Boom Supersonic (private) to add 15 of their $200m jets to the fleet, with the option of adding an additional 35, after certain safety, sustainability and operating metrics are met.

United States

MicroStrategy Incorporated provides business intelligence software and related services.  The Company's technology platform enables departments and enterprises to deploy Web-based reporting and analysis solutions.  MicroStrategy also offers consulting, training, and support services.  Solutions are provided to retail, finance, telecommunications, insurance, dot-com, and healthcare industries.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Microstrategy Inc Cl A (MSTR US)

MicroStrategy (MSTR US): Money From Nothing Is Worth?

MSTR may shortly boast a highly volatile investment, which is surpassed by a very real debt obligation, which is inadequately serviced by a modest,...

David Blennerhassett

Microstrategy: More Losses For Bitcoin Spruiker

I'm still not even remotely a buyer of this strategy. Arguably that "store of value" bet paid off in late 2020. But it hasn't worked for near on 17...

David Blennerhassett

Microstrategy's Unsurprising Bitcoin Loss

The 4Q21 loss is due to the inclusion of losses of US$146.6mn on its Bitcoin holdings, negating the $110.5mn in gross profit from its software ops....

David Blennerhassett

Microstrategy (MSTR US): Bitcoin's Mainstream/Fringes Balancing Act

But my preference would be cryptocurrency exchange platforms, as they capture all key digital currencies, plus dumb down some of the volatility of...

David Blennerhassett

Weekly Innovation Review (WIRE) #35

Headline developments are all up in the air this week, starting with United Airlines (UAL) who have signed an agreement with Boom Supersonic

Granite Bay Capital

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)