[I published this article on March 11, 2021 (almost 2 years ago) at read.cash. A clear warning about the stock, which now is down 90% from the recent ATH. I rewrite and republish it for Medium with a few modifications, adding recent information.]  

Some of us were still too young at the beginning of the millennium, while some weren’t even born. We are trying to find pieces of this puzzle as the dot-com bubble was the starting phase of an economic meltdown that transpired in 2008.

Money was pouring into tech companies, and any website running under a dot com top-level domain was getting listed on Nasdaq and making millionaires overnight.

Microstrategy was part of this bubble, with Saylor standing as the CEO. I did some research on the company during that era, and everything looks to be shady and corrupt.

The Bubble Popped

March 2021: Full Chart of Microstrategy stock price:

[Update Dec. 2022]:

As expected, the Microstrategy bubble popped (again):

Saylor clearly understands bubbles.

Saylor’s dot-com days:

The company went public in 1998, and just two years later, it reached more than $3000, which was 80 times higher than the IPO price.

The S.E.C. contended that Mr. Saylor and two other MicroStrategy officials, had committed fraud in reporting profits when the company was actually losing money.

Source: New York Times

The tech bubble imploded in 2000–2001, and the price of Microstrategy went back to the ground as this medium-sized software company wasn’t Microsoft or Oracle.

MicroStrategy did agree to a cease-and-desist order and promised to make “significant” internal changes in order to ensure that it complies with securities laws in the future. In addition, the company’s corporate controller and accounting manager agreed to individual cease-and-desist orders for reporting and recordkeeping violations.

Source: Computerworld

The price crashed as the dot-com bubble officially reached its peak in March 2000 and never recovered. Until 2021.

How Saylor turned what was once a $313-a-share stock and the biggest fortune in Washington into a $4.09 stock and a merely moderate number of millions is an amazing tale of hubris, hyperbole and high-tech hallucinations.

Source: Washingtonpost

Fast forward to 2013

The next time we find Michael Saylor was during the 2013 Bitcoin bubble. It appears that Saylor had bought Bitcoin at an early stage, although he also sold it all for a small profit, missing out on the exponential gains other investors received.Bitter for not sticking to his Bitcoins, he posted tweets like this one:

The US had outlawed online gambling since 2006 but only enforced the law in April 2011 on the event we called “Black Friday”.

FTP (Full Tilt Poker) was accused of running a Ponzi Scheme and defrauding its users. as its unsustainable model collapsed.Saylor might have had some inside knowledge when making this statement. Perhaps it was his intuition and experience with internet platforms, but still, he wasn’t wrong.

The situation in MtGox was similar to FTP during these days, new money was entering Bitcoin, but the withdrawals from the MtGox exchange were problematic. In the end, MtGox collapsed, and Bitcoin entered a two-year bear market.

Seven years later

The Microstrategy bubble popped in 2022. This time, the stock price started rising after Saylor evolved into one of the top Bitcoin advocates and invested almost all the cash/profits of Microstrategy into Bitcoin.

A reasonable bet, as right after the halving, the charts were looking bullish, and the good news kept coming.

However, Saylor embarked on a twitter journey, trying to promote his image and give some thoughts on Bitcoin that went far, contradicting most of the reasons Satoshi created Bitcoin. The price of Microstrategy pumped as the whole market was bullish.

The trillions printed for the 2020 quantitative easing supported the bull run. Saylor promotes regulations, misrepresents decentralization, and insists on abiding by any requests of the governments if it will help Bitcoin’s price rise. Missing the point that Bitcoin requires nothing and is not susceptible to any regulations and restrictions.

The stock market was in a bubble in 2021 (update: NASDAQ is down 35% YTD), and perhaps cryptocurrencies are somewhere in the middle (note: this was March 2021 when I published this article).

Closing Thoughts

Saylor was playing his game and even convinced Musk to buy Bitcoin with a billion dollars at the beginning of 2021.

Microstrategy’s stock advanced together with Bitcoin, but it is pegged to volatility and attached to the Bitcoin trend, they both plummeted together.

We have not seen public addresses, and do not know where he bought his Bitcoin. Some suggest it was at Coinbase, so it could be part of the news from that exchange (beginning of 2021) about an influx of institutional money entering (back when Microstrategy was buying massive amounts of BTC in 2021).

Will Coinbase inform us about any withdrawals of fiat in banks, in terms of billions of USD, if they are to happen? [they did happen and no exchange informed anyone besides insiders].

When the downfall begins (update: the bull run ended two months after I published this article), we will notice it on the charts, but no exchange will alert us about a massive exodus.