As volatility declines, Michael Saylor unveils the resilience of Strategy during 80-90 percent drops in Bitcoin, showing that Bitcoin is increasingly strong and stable in the market.
In a November 18 interview with Fox Business, the Executive Chairman of Strategy, Michael Saylor, disclosed that the volatility in Bitcoin has been gradually declining since 80% in 2020, down to approximately 50% at present.
Even after the latest price declines of nearly 11 per cent, Saylor is not deterred, claiming that Strategy can survive an 80-90 per cent Bitcoin crash without collapsing.
The company is designed to draw down by 80 to 90 percent and continue running, he stressed, and added, We are very resilient.
Saylor emphasised that the falling volatility of Bitcoin is a sign of growing market stability and not the market’s weakness.
He estimates that the volatility of Bitcoin will keep falling by an average of five points every few years until the volatility is half the price-to-book ratio of the S&P 500 (Bitcoin will perform better than the index accordingly).
This development is contrary to the widely publicised allegations that institutional interplay has negatively impacted Bitcoin stability. I have never seen Bitcoin any stronger than it is now, he said.
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Strategy’s Robust Position Amid Market Shifts
The current number of Bitcoin being held by Strategy is about 649,870 with a value of nearly 60 billion, and therefore, the organisation has a solid financial base despite the current changes in the market.
The net asset value multiple of the company has varied between 1.52x in the October all-time high of Bitcoin to a more recent 1.11x, due to additional market corrections.
Saylor maintains that this scenario does not pose any threat to the long-term model and profitability of Strategy.
Strategy purchased additional Bitcoins in the week of November 10-16, a total of over 8,178 worth over 835 million, which served to strengthen the belief in the future of Bitcoin.
Bitcoin exposure by institutions is on a steady rise, and that has been demonstrated by the recent big investments in Bitcoin by the Canada CPP pension fund and the Florida pension fund.
Saylor considers bitcoin to be a better store of value that can supersede gold and the S&P 500 in the long run.