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▲ Digital Gold Bitcoin/Source: Michael Saylor Twitter
An extraordinary plan has been revealed where global institutional "whale" investors intend to absorb the entire supply of newly mined cryptocurrency released into the market. As a result, there is a forecast that the virtual asset market could enter a phase of massive supply depletion.
Michael Saylor, CEO of Strategy, stated in a CNBC interview on May 21 (local time), "Bitcoin (BTC) has confirmed strong support at the $60,000 level after undergoing a correction from its peak of $125,000 recorded last October, and has entered a 'spring' phase of resuming a full-fledged rally." Saylor added, "The current virtual asset market is facing some macroeconomic headwinds," but "the passage of the US cryptocurrency market structure bill could act as a powerful catalyst." He also analyzed, "Even if the bill does not pass Congress, merely the announcement of new guidelines and innovation exemption provisions by the US Securities and Exchange Commission allowing asset tokenization could be a major boon to attract institutional capital inflows."
Saylor believes that with the halving approaching in two years and the fixed supply limit, the organic supply in the market could be depleted by the expansion of the institutional credit market. Strategy has directly purchased more Bitcoin from the market this year than the total supply produced by miners worldwide. Saylor announced that, based on the company's $65 billion in assets and credit capital, it plans to exclusively purchase all Bitcoin produced from now until 2140, the final year of mining. This means that the credit market will absorb the circulating supply released into the market before the maximum issuance of 21 million BTC is reached.
A financial engineering-based preferred stock product was presented as a key driver supporting this buying strategy, which converts capital gains into a fixed credit dividend of 11.5% with tax deferral benefits. This structure is designed to reduce volatility and protect against downside, similar to S&P structured products, and applies a variable dividend rate to maintain the stock price around $100. If the stock price exceeds $100, it is immediately sold through a shelf registration. In a situation where Bitcoin's price is expected to rise by an average of 30% annually, only the initial 11.5% of the value increase is paid to credit investors as preferred stock dividends, while the remaining excess profit is absorbed by common stock investors to maximize returns. This credit product grew from a $0 balance to $10.5 billion in just 10 months since its launch and is currently expanding at a rate of $24 billion annually.
Saylor also refuted the technical threats and quantum computing risks raised by some pessimists, citing the infrastructure's inherent resilience. He believes that even if a real threat from quantum computers materializes in the future, the entire Bitcoin network could be cryptographically upgraded and defended within a few months, similar to software updates by Apple, Google, and JPMorgan. With nearly 900 million virtual asset account holders worldwide, he argues that the market's sustainability has already been proven.
There was also an assessment that blockchain-based tokenization technology is creating a free market that returns the power of credit formation and interest rate determination, which banks monopolized in the 20th-century traditional financial system, to asset owners. This structure allows investors to choose optimal credit conditions and high liquidity without the constraints of borders and intermediaries, thereby increasing the velocity and productivity of capital. Saylor's vision leads to the prediction that Bitcoin's long-term value could reach $1 million amidst the trend of financial democratization and increased capital efficiency.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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