Michael Saylor says, "It’s not debt, it’s convertible debt. #Bitcoin could go from $100K to $1K, the debt is not going to get called, there is no recourse.” 🙌

I've been in a company that got taken by convertible debt. The minute the sharks smell blood, they will short your stock into oblivion and drive you into bankruptcy. They make more money on the shorts than they do on the convertible debt they hold as a hedge.

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Uh..ok

Okay! Let’s pretend I’m explaining this to you like you’re 5 years old, using simple words and fun ideas. We’re talking about what Michael Saylor said about money and a special toy called Bitcoin. Here we go! What Michael Saylor Said Michael Saylor is a grown-up who runs a company called MicroStrategy. He loves Bitcoin, which is like a magical digital coin that can go up or down in value. He said something like: “The money we owe isn’t really debt—it’s special debt that can turn into toys (shares of his company). Even if Bitcoin’s value drops a lot, from $100,000 to $1,000, the people we owe won’t ask for their money back, and they can’t take my stuff!” Why That’s a Little Tricky Some smart grown-ups who know about money looked at what he said and think it’s not totally true. Let’s break it down like a story: 1Special Debt Is Still Debt ◦Imagine you borrow some candy from a friend and promise to give them toys instead if they want. Even though it’s “special,” you still owe them something! Michael’s “special debt” is still money his company has to pay back or turn into company shares. It’s not like it disappears—it’s still a promise! 2What Happens If Bitcoin Gets Small? ◦If Bitcoin’s value goes way down (like from a big $100,000 toy to a tiny $1,000 toy), his company’s toys (shares) might not be worth much either. The friends who lent the candy might not want the toys anymore—they might say, “Give us our candy back!” But if Michael’s company doesn’t have enough candy (money), they might have to make more toys (shares) to give away, which means the old toys (shares) become less special for the people who already have them. 3“They Won’t Ask for Money Back” Isn’t True ◦Michael says the friends won’t ask for their candy back. But some of that candy has a due date—like when you promise to return a toy by a certain day. If he can’t pay or give toys, the friends might get upset and ask for help from other grown-ups to fix it. So, it’s not as safe as he says! 4No Taking Stuff Doesn’t Mean No Problems ◦He also says the friends can’t take his personal toys (like his house or car). That’s true! But if his company gets in trouble, the company’s toys (shares) might become less fun, and it could be hard to borrow more candy (money) later. It’s still a big problem! My Simple Take I think Michael is trying to make it sound easy and safe, but it’s not. He’s done a good job so far—his company’s toys got more valuable because Bitcoin went up, and he used borrowed candy (low-interest debt) to buy more Bitcoin. But it’s like walking on a wobbly rope high up—it’s exciting, but he could fall if Bitcoin gets small. It’s not a free ticket to play forever! The Big Answer The smart grown-ups say Michael’s words are a bit confusing and not totally right because he’s not telling the whole story about the risks. His idea has worked for now, but it’s tricky, and he needs to be careful! Does that make sense, little buddy? Want me to explain any part again with more fun examples?

Convertible debt

This is funny 🤣, I don’t give a fuck how you twist this… still sounds like a scam.

Basically: if btc falls MSTR will be diluted to pay the debt If btc goes up it will be diluted by @saylor for the ATM

The statement is misleading to casual listeners by downplaying debt’s nature and risks, and it’s financially flawed for omitting dilution, default, and maturity pressures. Saylor’s track record—MicroStrategy’s stock soared with Bitcoin’s rise—lends him credibility, but this specific claim lacks rigor. I’d add a caveat: his strategy has worked so far, leveraging low-interest debt to amplify Bitcoin gains, but it’s a high-wire act, not a free pass.

Michael Saylor, MicroStrategy's CEO, is discussing the company's use of convertible debt to invest in Bitcoin. Convertible debt can be turned into stock or cash, reducing risk if Bitcoin's price drops. This strategy allows MicroStrategy to maintain financial stability even if Bitcoin's value fluctuates significantly, as Saylor claims the debt won't be called or lead to recourse.

If the equity goes low enough there is no way to pay without taking the value of a share to basically 0.

@saylor is not afraid of the loans he is afraid of the SEC violations and the accounting irregularities. This is not his first scam rodeo