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I can't be the only I've thinking that corporations putting some of their liquidity into because it helps their stock price means they will panic and dump hard as stockholders scream in the next bear market? IOW, they'll behave just like retail before them, and we're still very much boom & bust cycles

(Hodlers don't care, ofc)

@rusty We can only hope they do, and maybe we'll get another three years to accumulate.

Then, the next time they choose to put a few $Billion into they'll get a lot less corn....

@rusty There was also Gregory Maxwell's take about them possibly becoming targets for leveraged buyouts: bitcointalk.org/index.php?topi

@rusty (Which has the same effect as them dumping their BTC.)

@harding @rusty Contrary to some other assets Bitcoin is easy to value objectively, and I doubt this is going to be an effective way to get at a healthy company's Bitcoins.

@JuergenStrobel @rusty I don't understand what the ability to objectively value BTC has to do with it. Historically most leveraged buyouts[1] were for companies that held cash or near-equivalents like treasury notes, which are also easy to value objectively.

The problem is that if Foo Corp has a bunch of cash reserves relative to its overall market cap, you can borrow funds to buy all the shares of FOO, then use Foo's cash to pay off most of the money you borrowed.

[1] en.wikipedia.org/wiki/Leverage

@harding @rusty Historically that also happened mostly to *distressed* companies. I agree, for a distressed co it doesn't make sense to invest in volatile long term savings before getting their shit together.

@JuergenStrobel @rusty LBOs make sense for any company with stable cash flow that exceeds the anticipated cost of the interest payments on the final debt amount.

In any case, we'll see what happens. Certainly nobody's going to be lending me a few billion to buyout Microstrategy (even if I wanted to). 🙂

@rusty

I don't know. In my experience many retail "investors" don't even bother to look at the charts, at least not beyond a few years. I doubt many CFOs are as shallow and rash. Saylor has been pretty clear when he talks about time preference and Bitcoin's past performance. I think the majority know what they're getting into. They'll likely be planning to use derivatives, but I doubt we'll see the same sort of sell-off as in the past.

@georgevaccaro In my experience, organizations behave in ways statistically similar to individuals. It will be later adopters who will cause this effect, not early ones, IMHO.

@rusty yes, I think the idea that we're somehow magically past the boom'n'bust market psychology cycles is kinda silly. Try as we like, the average human is still interested to buy things that are appreciating in value, and sell things that are depreciating, fundamentals be damned.

Its also nice to assume that companies buying large amounts of BTC are well informed on the subject matter, but then there are examples like this that prove otherwise:

nextechar.com/press-releases-a

@rusty Seems a bit weird to think it would be any other way? I could see corporations being slower to dump due to regulatory constraints/bureaucracy and that reducing the size/speed of a crash a little bit, maybe?

@ajtowns I think people confuse Saylor's rhetoric about reserve asset (which implies a degree of stickiness) with a simple NGU play of those who may follow. Also, Saylor and Musk have a maverick reputation, so they may well ride it out. Others may not?

@rusty I guess I'm pretty strongly discounting all the "final cycle" rhetoric that's about. Can't say I associate "stability" with Elon Musk's activities though...

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