Saylor, Strategy Executive: Investors Are Chasing Assets Robots Cannot Produce

Saylor, Strategy Executive: Investors Are Chasing Assets Robots Cannot Produce In Brief: Michael Saylor says Bitcoin, after bottoming below $60,000, could again climb above $100,000; he set no specific timeframe for this forecast. According to Saylor, AI could erode the value of companies that rely on human labor and redirect capital toward scarce assets

Michael Silver says Bitcoin can cross $100,000 again after bottoming below $60,000; He did not set a specific time for this prediction.

According to Silver, artificial intelligence can devalue human-reliant companies and drive capital to scarce assets like gold and bitcoin.

MSCI's future decision about the presence of companies such as Strategy in global indices, the recent sale of this company and the competition to attract capital are among the factors affecting the market outlook.

Michael Silver, CEO and co-founder of Strategy, says Bitcoin has entered a fresh bull market and could rise above $100,000 again after bottoming out just below $60,000. He did not specify a time frame for achieving this goal, arguing that the spread of artificial intelligence will drive investors to assets whose supply cannot be increased.

Bitcoin bottomed out just below $60,000 during the market crash of the past year, before returning to the $80,000 range, Silver said in an interview with Bloomberg TV on Tuesday at the "Washington FinTech Week" event. Instead of months, he said, he considers his time horizon based on centuries. Strategy's long-term forecast is that Bitcoin will grow by 20-30% annually over the next two decades.

The main focus of Silver's argument is scarcity. He believes AI will reduce the value of companies that rely on extensive human labor or finding the next disruptive product, and instead increase demand for scarce assets; From prime real estate in Palm Beach and gold to Bitcoin. According to him, investors will look for things that robots cannot produce more of.

This argument is valid in one respect: if AI makes labor and software more abundant, assets with limited supply may become relatively more attractive. However, this view is expressed by the CEO of the largest corporate holder of Bitcoin; The one who declared the value of this company's assets to be more than 70 billion dollars. Bloomberg interviewers also pointed out that artificial intelligence attracts a large part of the capital market and the rotation of capital towards scarce assets is not yet clearly seen in the price of Bitcoin; The price of this cryptocurrency is still around 30% lower than last year's record.

In response, Silver said that since the start of buying Bitcoin by Strategy in August 2020, the annual return of this cryptocurrency has been about 38% and the annual return of the company's stock has been more than 50%; Better performance than Gold and all the companies in the "Magnificent Seven" group except Nvidia. He also described Bitcoin as a volatile asset, saying that its volatility is around 40, while Strategy stock's volatility is close to 80.

Silver pointed to several other supporting factors: a more favorable regulatory approach in the US, faster adoption of Bitcoin by banks, the proliferation of tokenized securities and the growth of digital credit. He considered the suspension of the progress of the "Clarity" bill in the US Senate as the best result for this industry and said that the guidance of the Ministry of Treasury, the Securities and Exchange Commission and the Commodity Futures Trading Commission were more favorable for this sector than the limitations of this bill.

He also defended Strategy's sale of a small amount of bitcoin in June, when the price was around $73,000; An action that worried the market. Silver said Strategy is a structured finance company and should be able to buy and sell bitcoin, stocks or credit as needed; This is mainly done to support the dividend of the company's credit products. According to him, these products have a yield of 10-12%, which is considered as a return of capital and defers the payment of taxes. He added that Strategy expects to continue to increase its Bitcoin holdings in the bull market.

The closest event ahead of the market is MSCI's decision on Friday to potentially remove companies like Strategy from global indices; MSCI is considering whether to drop companies that are primarily focused on accumulating assets from its indexes. Silver considered this proposal as an undesirable precedent and said that Strategy is an operating company, similar to banks and insurance companies. At the same time, he did not consider the importance of this decision to the company.

However, the removal of Strategy from indexes can lead to the sale of stocks by index funds, even if Silver considers its importance to be low. On the other hand, Strategy's willingness to sell bitcoin while buying it challenges the assumption that the largest corporate holder of bitcoin is always a buyer, and could be a source of more supply in weak markets.

Regulatory guidance from US institutions has eased one of the hurdles facing the market, but Bitcoin continues to compete with AI stocks and Treasury yields to attract capital; The yield has increased greatly this year. The decline in bond yields after the release of US inflation data could serve as a support factor for Silver's prediction of Bitcoin crossing $100,000.