Bear market for the first time? It is also the first Bitcoin (BTC) bear market for Michael Saylor, one of the biggest Bitcoin bulls in the world.
Executive Chairman of one of the largest pro-Bitcoin companies in the world, Saylor took time out of his busy schedule at the Los Angeles Pacific Bitcoin Conference to speak with Cointelegraph. Basically, Saylor told Cointelegraph that when it comes to Bitcoin, “you have to take a long-term perspective.”
“If you buy [Bitcoin] and you have a time horizon of less than four years, you’re just speculating. And once you have a time horizon of more than four years, the obvious thing is your average dollar cost.
The purchase average is a means of reduce an investment’s exposure to volatility. Saylor continued, “You buy the asset that you want to hold for a decade or more, which is the long-term store of value.”
To 130,000 BTC, MicroStrategy holds 0.62% of the total Bitcoin supply, as the total Bitcoin mined is limited to 21 million. MicroStrategy’s entry price is around $30,639 per BTC, which means the technology group’s total investment is considerably underwater – if it were to sell for cash.
However, Saylor is baffled by the loss – on paper – of billions of dollars, saying, “Don’t get caught up and watch the price day by day, week by week.”
The billionaire compares the valuation of Bitcoin to the valuation of a house. He joked that “if you bought a house and every time you went to a party you got drunk and then at 11 p.m. or midnight you got up and said, ‘How much are you going to pay for My house ? I want to sell my whole house to you now. Someone might say, ‘Well, I’m not really in the mood to buy a house. I’ll give you about half of what you paid,” then you’ll go home discouraged and say, “I’ve lost all my money.”
Avoid that anxiety, he advised, and if you really need money over the next 12 months, it’s not investable capital; instead, Saylor explained, “It’s working capital.”
“A logical model is that if you live in Argentina, you hold pesos for a month or two, you hold dollars for a year or two. You hold Bitcoin for a decade or two. And when you think about it in those frequencies and timeframes, it all starts to make sense.
Finally, as Changpeng Zhao, CEO of Saylor and Binance suggested, take custody of your bitcoin. In light of another crypto exchange disappearing with customer funds, taking custody of Bitcoin is the only way to secure assets that cannot be confiscated.