Michael Saylor published a zoom conversation with their President and CFO on why they have adopted a Bitcoin Standard at MSTR and the evolution of BTC from a digital asset to digital gold to digital property to digital energy, capable of powering a machine, family, corporation, city or country.

Transcript:  I think March of 2020 was pretty transformational.  What we ended up with was a pandemic that severely impaired the operations throughout the business world. And, it became very hard, to conduct business as usual, and that was coupled with a monetary response of lowering interest rates to zero and beginning to pump liquidity into the financial system of the world. And, we didn’t know what would happen, in our core business we realized we could run more efficiently, and we had a digital transformation in our core business and we started zooming everywhere and using the web and using youtube and using Twitter and the like and I think everybody was familiar with that.

What they are less familiar with is that on the balance sheet side of the business. Microstrategy had cash of an excess of 500 million dollars, which is a lot of cash, probably half of our market cap was cash. And, we were investing that cash in Sovereign debts. So, the cash and credit on our balance sheet were now yielding zero percent interest.

In the macroeconomy, we saw a K shape recovery. All the main street companies had a hard time operating, but all the wall street stocks and equities, and assets all appreciated rapidly by May and June time frame.  So, there was something different going on there was delamination between wall street and main street.

And, our conclusion in the second quarter was we are going to be in an environment where there was going to be monetary inflation, and because we had so much of our capital tied up in cash and credit we are going to have a negative real yield.  We are going to have 0% interest and if the cost to capital leaps by and triples, then we will have a negative real yield. As it turns out over the past 18 months, the inflation came in yesterday, the CPI inflation came in like 5.3 or 5.4%, and the S&P 24%.  The S&P was a surrogate to the cost to capital and it is also a surrogate for the monetary inflation rate. Another way to say it is our shareholders expected us to get a 24% yield on that capital. And, if we were going to get 0% and their expectation is 24% We kind of calculated and we realized that if we simply held cash and credit on our balance sheet for the next 4 years, we are going to destroy 250 to 300-million-dollar shareholder value. And we needed to do something. And this something is to invest in a property that will appreciate faster than the inflation rate or we need to give it back to the shareholders. And, we were not sure what was the right thing.  Giving it all back to the shareholders would be like we are decapitalizing and we would have no treasury assets left and this did not make any sense.

And, we thought well if we invested in something our shareholders might think we are moving aggressively. We announced a 250-million-dollar tender offer to buy back our stock and a 250-million-dollar program to buy hard assets. And, we searched through everything under the sun, we looked at equities and gold and commodities and crypto and we concluded that what we wanted to buy as digital gold or Bitcoin in this case!