micro strategy just unlocked a $3. 9 billion infinite money glitch and here's how you can steal it yes you've heard that right Michael sailor's company micro strategy has engineered a strategy so powerful it's turned 3. 9 billion in debt into a $15 billion Bitcoin fortune and the best part you don't have to be a billionaire or a big Corporation to take advantage of this by the end of this video you'll understand how to steal sailor playbook for yourself so in this video I'm going to break down how microsof strategy levered billions to create a Bitcoin windfall what exactly is the infinite money glitch and how you can apply it for your own Investments and if there's still time to jump in and make this strategy work for you now real quick my name is Mark Moss I've been a tech investor for two decades two big exits I speak on the largest Bitcoin stages in the world I'm a partner in a leading Bitcoin Tech VC hedge fund and I'm launching a brand new publicly traded company called Matador that's going to be following this micro strategy Playbook 2.
0 so let me break down how we're stealing this strategy and how you can do the same all right we're going to jump right into the infinite money glitch now listen there's a lot to cover I want to tell you why they decided to make this and how it works and what their competitive Advantage is and of course at the end the last slide I'm going to show you how you can do this there's a couple ways you can play this on your own but let's just start with this because I don't think anyone's ever broken the math down this way you've never seen this before the infinite money glitch we all want that right okay so number one let's explain how the the glitch works so basically what micro strategy is doing from a nutshell we'll get in the details from a nutshell is they're taking on debt and they're buying Bitcoin with it all right now up to date since 2020 they've taken on almost $4 billion $3. 9 billion in debt and they're now sitting on over $15 billion dollar in in Market valuation so four billion in debt $1 15 15 billion sounds pretty good right but how does this work let's sort of break down the math okay so what micro strategy is doing is they're using debt but not just any debt what they're doing is they're using something called Equity convert markets and so because micro strategy has Equity it's a publicly traded stock they're able to use that Equity that public equity and put that up as collateral to borrow money at really good rates now that Equity could convert over if they don't pay it back and so they're able to leverage debt at a crazy low level now you and I unfortunately we can't do this personally other businesses are starting to do this and I'll show you how that's working but we can do it at different rates but let me show you the math okay so they've taken on kind of two different types of debt one they take on debt and their their highest amount they're paying is crazy 1. 76% interest on that and then for the notes that are convertible they're paying 0.
8 so they're literally borrowing billions of dollars at 0. 8% wow I wish I could get that but we can't now if we look at this we can say let's just take the highest amount I didn't go through and look at all the different percentag in ches let's just assume that all the debt the 3. 9 billion is all at the 1.
76 amount which is not so it's actually less than this number but for the easy math let's assume it's at the 1. 76 that would mean that they owe $68 million a year just in interest 68 million a year in interest okay now what does that mean for us and how does this work in the infinite money glitch well they're borrowing billions 3. 9 billion they have 15 billion in Bitcoin but they owe 68 million just in the Debt Service but here's the thing if we take a look at Bitcoin since micro strategy has been doing this which is the last four years we can see in the last four years since 2020 Bitcoin has been averaging a 55% return per year now we can look at different time periods we can go since the beginning of time it's you know the last decade it's about 150% but I think the last four years is a pretty good time period to look at 55% compared to the S&P 500 133% NASDAQ 133% uh bonds losing money silver 2% gold Etc but 55% so again back to the simple easy math they're borrowing at 1.
76% and they're buying an asset that's going up by 55% the four-year average so what this means is that they're making 55 they're paying the 1. 76 they're netting they're profiting 53. 2% per year by borrowing low and buying High maybe we'd call this a speculative attack they're buying in a cheap failing currency and they're buying in a harder currency now we can do the same thing there's companies doing the same thing and you don't have to be a billionaire to do this so let's break down how we can do this now first thing why are they even doing this besides the fact of making a lot of money we want to understand micro strategy's big pivot now Michael sailor has been on many uh shows conversations talking about this um I speak at a bunch of conferences with him I've been at his house I've had dinner with him multiple times we've discussed this in great detail and it's not a big mystery like I said he's done lots of shows talking about it and basically micro strategy is a software business and their business model was sort of trending down the business model of of a software compan is great because there's a lot of recurring Revenue Mrmonthly recurring Revenue but it's very hard to continually build new software and stay up to date and so he said look you know I looked at this from a perspective of we have a lot of cash but the cash is losing value this is in 2020 when they were printing trillions of dollars of stimulus so the cash is losing value very very fast I don't know if I really want to invest it back into the software business um but we have this good cash flow and asset so what should we do well we looked at all the options we put into bonds or real estate or stocks or whatever and we realized that the best place we could put billions of dollars for a hundred years that was the qualification the best place to put a big chunk of money for a long period of time was Bitcoin and so they did now I want to say right here that smart people changed their mind and this is for all the Skeptics that are out there that think this is all a bunch of scam and joke and Magic internet money Michael sailor did too this is is a tweet from him December 18th of 2013 and he said that bitcoin's days are numbered it seems like just a matter of time before It suffers the same fate as online gambling so in 2013 he thought it was a scam he thought it was a joke he thought it was going to go away and they get rid of it however then uh just a few years later well seven years later to be exact on September 14th 2020 Microsoft micr strategy completed its first acquisition of 16 almost 177,000 Bitcoin amazing uh Bitcoin at an aggate purchase price of $775 million so he went from 2013 saying look this is a joke it's a scam it's never going to last it's going to go away to 2020 um buying billions of dollars with it and now 2024 being what we call the gig ad uh he's like the biggest advocate of this and he talks about it all the time so they had to Pivot away from the software but they still have the software business we're going to talk about this when we get deeper into the into the plan of how you can apply this but what they really built wasn't just a way to hedge I put here the Hedge isn't as good as a leveraged play so it wasn't they were just trying to hedge their position like he wasn't just trying to say how do we preserve our cash by putting it into another asset stocks bonds Etc it wasn't a hedge he was trying to find a way to leverage it up to do some Financial engineering well he is an engineer from MIT that's why he thinks this way all right so now that you sort of understand the why you might ask yourself here if you're in the same boat do you have money that's in an asset that's not performing well and would you like to put that money into the best performing asset and would you like to follow an engineer from MIT and learn how to do some Financial engineering well let's figure that out what is the play for you then okay so the key is like I said from an MIT engineer how did he financially engineer this and it's not just holding not just holding it wasn't just hedging but it was Financial engineering to actually leverage this up and really what micro strategy offered to the market was what we call volatility as a product which sounds crazy right and that's because for the average investor they think that volatility is dangerous is one of the things that you hear about Bitcoin the most it's too volatile well uh turns out professional investors and allocators they want volatility they want it because volatility is this how do you make money if an asset say straight you don't you need volatility and people want to professional aers want to bring volatility to their portfolio believe it or not when well that's why they that's why there's smart money um and so he offered volatility as a product and he has a stock now that moves multiples on top of Bitcoin so bitcoin's already too volatile for some and now it moves multiples on top of that which means it's even more volatile but of course volatile means moving up and down not just down but up and down and what we can see here is that micro strategy has been outperforming everything else as a matter of fact we can see this sort of teal green line right here that's micro strategy and it's close sort of neck and neck with this blue line right here which is NVIDIA so Nvidia and micro strategy I've been absolutely crushing it everything else is down below this orange line right here that's where Bitcoin is and then down here this yellow line that just basically sits flat right here that's the QQQ then this uh blue line that's a even a little bit lower than the yellow line that's the Spy the S&P 500 so stocks are down here Bitcoin is right here Nvidia is right here and micro strategy is sitting right there compl completely outperforming everything because of the financial engineering that we have now it hasn't just been outperforming all of those things and even Bitcoin but when we look at it priced in Bitcoin this is the important thing I do everything like this we can see that micro strategy priced in Bitcoin since January of 2023 not since 2020 but since 2023 is up almost 300% 280% priced in Bitcoin just since January 2023 so it's been working really really well now back to the sort sort of the math how does he do this it seems very risky right Leverage is bad Leverage is dangerous especially on a very volatile product so how does Michael sailor how does an engineer from MIT manage the risk in something like this well they manage the risk with cash flow so as I said micro M micro strategy has been borrowing $3.
9 billion they have to pay $68 million a year in interest what happens if the price of the asset goes down what if Bitcoin drops to 15,000 or 10,000 so what he just has to pay the $68 million a year well how does he do that well turns out he has a company again a software company that throws off a lot of free cash flow so his company micro strategy is throwing off last quarter1 million uh annualize that'd be over 400 million this is a 5-year chart of the gross revenue on a quarterly basis and what we can see is this is 130 right here and right down here is about a hundred so we're in this about 1151 1220 millionar of gross cash flow per quarter or over 400 a year so he's making 400ish and he owes 68 is and so that's how he Hedges his downside even if the collateral even if the price of Bitcoin drops to 5 10,000 10 whatever it is as long as he can continue to pay the $68 million in interest he can do that now because of that because he has the cash flow this is key when we get back to how we apply this on our own because he has the cash flow to cover the debt service he can continue to leverage it up without the risk you see most people get themselves into trouble they burn their house down with the leverage but he is managing his downside okay does that sound good now how do you and I how do we steal this strategy how do other companies steal this strategy okay well before we get into how you and I and how other companies are stealing the strategy I want to give you the name of a couple before we get into that let's talk about just the the elephant in the room should you be buying micro strategy or should anybody be why wouldn't they just buy Bitcoin directly and this is a good question to understand Bitcoin or micro strategy which one's better especially considering that micro strategy is a big Hefty premium over to just buying Bitcoin directly so let's answer this question number one the way that micro strategy has developed this or financially engineered it again is that for about every $1 that Bitcoin goes up in price micro strategy goes up by $2 on their market cap that's pretty interesting and that's because of the leverage they put into the system also micro strategy has much better regulatory protection and Clarity what do I mean by this I am not telling you that the governments are going to make bigcoin illegal they're going to take away your right to own it I don't think that's the case not in the United States anyway I think that ship is sailed but still today there's a lot of Institutions funds um things like that that don't allow you to buy Bitcoin right it's a commodity they can only buy equities for example maybe some people maybe foreigners they can't buy the Bitcoin ETFs that are available and so it's very easy any one of these foreign um people institutions Etc can just buy an equity and so there's regulatory protection around equities they're already uh very well established but the commodity side or the ETF side of Bitcoin is still unclear of how different funds mandates allow them to do that so you can really think of uh micro strategy really as like a high octane ETF it's easy click of a button I can bring it in I don't have to custody it I don't have to worry about cold storage or any of that and it goes up at a much more uh multiple than just Bitcoin ETF if I buy the Bitcoin ETF for every $1 goes up micr strategy is going up by $2 but listen there are trade-offs um I'm not saying you should go buy a micro strategy what I'm saying is they're different they they hold different roles in your portfolio I'll break that down for you in a second but there are tradeoffs like I said one with micro strategy you don't have to worry about the onboarding and the storage and all those things but you also have a lot more volatility you have to work with or deal with I should say um and the one of the things with micro strategy versus Bitcoin is because of The Debt Service it has these reflexive feedback loops right so Bitcoin sort of sits in the middle and it continues to go up now what we can see is how that's worked out for micro strategy in the last four years and since 20120 we can see that micro strategy has outperformed everything with a 1,339 % return while Nvidia which is also outperforming thing is up 950 so that's a pretty big deal down here we have Tesla 15 153 Google 140 Microsoft 110 Apple 99 meta 81 Amazon 16% so because of this financial engineering from a MIT engineer like Michael sailor he's been able to propel his company to outperform everything else okay so how do you steal this how do other people steal this exact same strategy how can we do it it cuz I can't borrow at 0. 8% like he does and I'm sure you can't either okay there's a couple ways we can do this number one basically we're leveraging debt now this is something I've talked about for a long time um this really kind of came into my um purview when I was studying history of the Yar Republic the hyperinflation that happened there and a man in hu Hugo stenz became one of the wealthiest men in Germany at that time and he did it by forming a speculative attack which is basically borrowing as much money as you can in a failing currency to buy harder assets he was borrowing in the German Mark and he was buying factories and hard assets and this is sort of what um sailor's doing he's borrowing in dollars which are losing value and he's buying Bitcoin which is harder and going up so we can leverage debt now again you and I can't go leverage debt we can't go borrow a billion dollar to 0. 8 but we can still borrow for example you probably have debt you might have a house loan a car loan a boat loan something like that and you could either one pay down more principle on that credit card that house that car Etc you can pay more princi or you could take that money instead of paying more down on your home paying it off in 15 years you could take that money and you could go buy Bitcoin with it that's essentially the same as borrowing right I already have debt out if I'm not paying the debt down fast or buying something else I'm basically using borrowed money for that that's one way to look at it another way to look at it would be borrowing money out of my house maybe I took a home equity line a credit line something like that um obviously maybe my car is paid in cash I can get a title loan against my car I can get a credit card and I can borrow against my credit card and I'm certainly not saying that you should do those things what I'm saying though is we're leveraging debt now should we or shouldn't we do that well that's a personal question but let me break down some math for you so the first thing is we want to think about what is the average gain that we expect Bitcoin to have minus The Debt Service we're going to have to pay so I showed you with Mich with Micha strategy they're gaining about 55% a year but they're paying you know what is it less than 2% it was like 1.
