Billionaire Bitcoin maximalist Michael Saylor has relinquished his role as CEO of MicroStrategy, according to a company announcement on Tuesday. He spoke with CNBC the following day about the rationale behind the executive transition and his company’s financials.
No Changes to the Bitcoin Plan
In conversation with CNBC’s Squawk On The Street, Saylor reviewed MicroStrategy’s stock performance over the past two years. Despite tremendous volatility, it is ultimately up 123% since it first invested in Bitcoin in August 2020. That’s more than Bitcoin’s roughly 94% in that time, and the S&P’s 23%.
Saylor attributed the firm’s success to its stability as a software company, and its use of Bitcoin as a treasury reserve asset. “Bitcoin is the strategy that we used in order to outperform during a very difficult financial period when most currencies are crashing, and most assets are struggling,” he continued.
Though MicroStrategy has surged by 67% over the past month, it’s still down 19% from February, when Bitcoin was worth $37,000. The company also suffered a lofty $918 million impairment charge on its Bitcoin holdings in Q2 due to the asset’s descending price.
Saylor dismissed the charge as a “non-cash” write-off – and dispelled any myths suggesting it related to his pivot from CEO status. Rather, his ascension to his new role as Executive Chairman is to allow him to “be a more enthusiastic advocate for Bitcoin.” Meanwhile, new CEO Phong Le and CFO Andrew Kang will handle MicroStrategy’s daily operations.
Le, who formerly served as CFO, showed commitment to the corporation’s Bitcoin reserve strategy in January.
“Volatility is Vitality”
Saylor recognized the fact that many view his company as a levered bet on Bitcoin, and owned it. “Volatility is vitality,” he said. “One part of our strategy is a levered long Bitcoin strategy and we make no apologies for it.”
It’s also given MicroStrategy tremendous attention among stock traders and in the media, helping advertise the underlying software business.
However, the chairman does believe that Bitcoin’s volatility will fade within the next 4-8 years as regulatory clarity comes to the industry. In June, he listed 10 regulatory hurdles that he believes the asset must overcome before it becomes mainstream.
“There are large mega investors that have been afraid to put huge amounts of capital into this asset class until they understand the rules of the road,” he said.