MicroStrategy “red sweeps” in 2024, rising 477%, becoming the top technology stock | Real Time Headlines

eve micro strategystock market debut In June 1998, founder Michael Saylor moved into a penthouse suite at the Lotte New York Palace Hotel in midtown Manhattan. Thaler, who was 33 at the time, said it was the most exquisite hotel room he had ever seen, financed by lead underwriter Merrill Lynch.

The next morning, Thaler went to the Nasdaq market to watch his company’s stock open. He recalled a note scrolling across the ticker warning traders: “Please do not confuse MSTR with MSFT.” The latter was Microsofta software giant that went public 13 years ago.

MicroStrategy shares rose 76% on its first day, joining the ranks of technology companies that benefited from the dot-com bubble.

“It’s a great day,” Thaler told CNBC.

More than 26 years later, MicroStrategy and Microsoft are connected again, but for completely different reasons. In December 2024, Thaler stood up in front of Microsoft shareholders and tried to convince them that the company, currently valued at more than $3 trillion, should put some of its $78.4 billion in cash, equivalents and short-term investments into Bitcoin.

“Microsoft cannot afford to miss the next wave of technology, and Bitcoin is that wave,” Thaler said in a video presentation. Published on last week. The post has been viewed more than 3.6 million times.

Thaler has gone all-in on this strategy. Since mid-2020, MicroStrategy has purchased 439,000 Bitcoins, a stockpile now worth about $42 billion that underpins the company’s market capitalization, which has surged from about $1.1 billion at the time of the plan to $82 billion.

MicroStrategy’s software division, which focuses on business intelligence, generates revenue of just over $100 million per quarter. After huge gains in 1998 and 1999, the stock collapsed in the dot-com bust, losing nearly all of its value. Over the next few decades, it slowly rebounded. rising like a rocket Because of Bitcoin.

Four years after Bitcoin buying frenzy, MicroStrategy becomes world leader The fourth largest holderonly the creator Satoshi Nakamoto is behind it, BlackRock iShares Bitcoin Trust and cryptocurrency exchange Binance.

At Microsoft, a shareholder vote backed by Thaler failed by a wide margin—less than 1% of investors voted in favor.

But the spectacle gives Thaler, 59, another opportunity to spread the gospel of Bitcoin and preach the benefits of converting as much cash as possible into a single digital asset. This is the story that Wall Street has always been talking about.

As of Friday’s close, MicroStrategy shares have risen 477% this year second only arrive Apply love The company ranks first among all U.S. technology companies with valuations of $5 billion or more, according to FactSet. The increase in 2023 is 346%.

Although the rally was in full swing before November this year, Donald Trump’s election victory, funded The stock’s gains have been further fueled by a strong push from the cryptocurrency industry. Since the election on November 5, the stock has risen 60%, and finally surpassed the dot-com era high since 2000 on November 11.

Saylor has long spoken out about Bitcoin in an evangelical manner and in 2022 co-authored a book about Bitcoin titled What is Money? But his criticism has recently been stronger than ever describe Thaler as a cult leader and his strategies “Ponzi cycle” This involves issuing debt and equity to buy Bitcoin, watching MicroStrategy’s stock price rise, and then doing more of the same.

“Wash, rinse, repeat – what could possibly go wrong?” Peter Schiff, chief economist and global strategist at Europacific Asset Management, wrote in a Nov. 12 report Post on X To his 1 million followers.

Thaler, who has 3.8 million followers, addressed the growing chorus of skeptics in an interview on CNBC’s “Money Movers” last week.

“Like developers in Manhattan, every time real estate values ​​in Manhattan go up, they issue more debt to develop more real estate, which is why buildings in New York City are so tall,” Thaler is publishing Said in a video. “It’s been around for 350 years. I call it the economy.”

Saylor is a regular guest on CNBC, appearing on various programs throughout the year. He also agreed to two interviews with CNBC.com, one in September and another shortly after the election.

The first chat took place at the Lotte Hotel, just a few elevator stops from the penthouse where he stayed the night before his stock hit the Nasdaq. Thaler was delivering a conference keynote speech at the hotel and attending the conference at the same time.

He wore a designer suit and an orange Hermès tie, matching the designated color of Bitcoin. With the election less than two months away, cryptocurrency companies are pouring money into the Trump campaign after the Republican candidate and former president previously referred to Bitcoin as “Trump.” “A scam against the dollar” Start ensuring more crypto-friendly management.

Two months ago, in July, Trump gave the keynote speech at the largest Bitcoin conference of the year in Nashville, Tennessee. promised Fire SEC Chairman Gary GenslerOne industry commentator said that if he wins, the United States will become the “cryptocurrency capital of the earth.”

“I think the election year galvanized the crypto community to make its voice heard and sparked a lot of underlying enthusiasm,” Thaler said in the September interview. “When Trump showed a temporary positive attitude, it was bad for the industry as a whole. It’s a huge boost when he shows a completely positive attitude.”

Until this year, MicroStrategy was one of the few ways many institutions could buy Bitcoin. Because MicroStrategy is an equity stake, investment firms don’t need any special terms to own it. Things changed in January U.S. Securities and Exchange Commission Approval Spot Bitcoin exchange-traded funds allow investors to buy ETFs that track the value of Bitcoin.

Since Trump won, everything has been going in a good direction. Bitcoin is up about 41%, and BlackRock’s ETF is up 39%. Gensler prepares to leave SEC, Trump appoints deregulation advocate and former SEC commissioner Paul Atkins to replace him.

Venture capitalist David Sacks, an outspoken conservative, hosted a fundraiser in San Francisco for Trump, who will become the “White House artificial intelligence and cryptocurrency czar.” declare Earlier this month, he published an article on the Truth social platform.

Shortly after the election, Thaler said in a phone interview with CNBC: “As the red sweeps and Bitcoin surges, other digital assets will start to surge as well.” He said Bitcoin remains a “safe transaction” in the crypto space , but as a “digital asset framework” for the broader crypto market is put in place, “there will be a surge in the entire digital asset industry.”

“Taxes are falling. All the talk about unrealized capital gains taxes and wealth taxes is off the table,” Thaler said. He added that “all hostility from regulators to banks’ exposure to Bitcoin” has also disappeared.

MicroStrategy has become more active in its Bitcoin purchases. Thaler said in an article postal On December 16, in the six days starting on December 9, his company acquired 15,350 Bitcoins for $1.5 billion.

MicroStrategy has purchased 249,850 Bitcoins so far this year, nearly two-thirds of which have been purchased since November 11.

“We’re going to do it no matter what,” Thaler said of the election results. “But what was a headwind turned into a tailwind.”

A week before the election, MicroStrategy announced in its quarterly earnings earnings release Plans to raise $42 billion over three years. This included the sale of up to $21 billion in shares through financial firms such as TD Securities and Barclays, providing more liquidity for Bitcoin purchases.

Thaler told CNBC that this was “probably the most important earnings call in the history of the company.”

No amount of ownership is too much for Saylor, who predicted in September that Bitcoin could reach $13 million by 2045, equivalent to 29% annual growth.

“We will always continue to buy top products,” he said in the same TV interview, comparing Bitcoin to New York real estate. “Every day is a good day to buy Bitcoin. We think of it as cyber Manhattan.”

Thaler spoke passionately about Bitcoin being the foundation of a new digital economy that will only get bigger. But even since his Bitcoin strategy kicked off in 2020, investors have experienced some serious pain—the stock lost 74% of its value in 2022 before soaring over the past two years.

Still, he recommends that companies copy his strategy. Microsoft didn’t listen, but Thaler said there are a lot of “zombie companies” whose core operations haven’t moved anywhere where their cash can be better utilized.

“Conventional advice is, you make a transformational acquisition and you find out you need a merger partner. You’re dead. Find someone you can merge with,” Thaler said at Rakuten in September. “Bitcoin is the universal merger partner, right? The real appeal of digital capital is that you can fix any company.”

watch: CNBC’s full interview with MicroStrategy CEO Michael Saylor