Chainfeeds Summary:
Crypto analyst Willy Woo states that the only liquidation risk for MicroStrategy is its issued convertible bonds.
Source:
https://x.com/woonomic/status/1861810991614545980
Author:
Willy Woo
Viewpoint:
Willy Woo: The only liquidation risk I can see is its issued convertible bonds: 1) If the convertible bond buyers don't convert to equity before maturity, MSTR will have to sell BTC to repay the debt holders. 2) This will happen if MSTR doesn't achieve over 40% growth in 5-7 years (varies by each bond, see table below). Essentially, either MSTR's BTC association fails, or BTC fails. There are also other varying degrees of risk: 1) Competitive risk, other companies copying and reducing MSTR's premium to net asset value; 2) SEC intervention risk on future purchases, reducing MSTR's premium to net asset value; 3) Fidelity and Coinbase custody risk; 4) US nationalization risk (seizure of BTC); 5) Saylor key person risk; 6) MSTR operational risk.
Source
