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Investing.com -- MicroStrategy Chairman Michael Saylor dismissed recent criticism from a legendary short seller during a Bloomberg TV interview Tuesday, explaining his company’s business model and outlook on Bitcoin’s future.
Responding to Jim Chanos’s short call on MicroStrategy shares, Saylor stated, "I don’t think he understands what our business model is. We are the largest issuer of Bitcoin back credit instruments in the world."
Saylor explained that MicroStrategy recently raised $1 billion by selling preferred stock, which he described as "borrowed money that we never have to pay back that we pay a dividend on but we could suspend if we needed to." This approach allows the company to purchase Bitcoin without diluting common stock.
The CEO addressed Chanos’s criticism about MicroStrategy shares trading at a premium to Bitcoin’s value, noting that the company is "not a holding company or closed in trust" but "an operating company" that can leverage Bitcoin and issue preferred shares.
"Our company generated a BTC dollar gain equal to about $8.4 billion in the first two quarters of this year. That is the equivalent of earnings for a Bitcoin treasury company. Our target for the year is $15 billion," Saylor said.
When asked about the company’s valuation, with approximately $63-64 billion worth of Bitcoin holdings but a market cap of about $106-107 billion, Saylor suggested investors should consider both the Bitcoin holdings and the company’s ability to generate Bitcoin gains.
"If the company generates $10 billion from Bitcoin gains this year you have to put a ten or 20 multiple," he explained, adding that the "Bitcoin treasury company operation is worth a multiple of 10, 20, 30 or 40 times the yield we are generating."
On Bitcoin’s future price trajectory, Saylor was bullish: "Winter is not coming back. We are past that phase. Bitcoin is not going to zero it’s going to $1 million." He cited political support, including from "the President of the United States," the cabinet, and financial figures like Scott Bessent and Paul Atkins.
Saylor explained that limited Bitcoin supply (450 Bitcoin available daily, worth about $50 million) combined with increasing institutional demand from companies, ETFs, and potentially nation-states would drive prices higher.
"I think when Bitcoin rallies if it surges to 500,000 or $1 million then maybe we can talk about it crashing down by $200,000 but at the current price levels it only takes $50 million to turn the entire driveshaft of the crypto economy," Saylor concluded.