AUS
NZ
UK
CA
USA
FRA
GER
ESP
ITA
NLD
PRT
SWE
GRC
IND
POL
BRA
ZAF
RUS
CHN
UAE
Highlights
- Michael Saylor, who has always been bullish on cryptocurrencies, is set to quit as MicroStrategy’s CEO
- Tesla, led by Elon Musk, recently sold its Bitcoin holding, which resulted in a fall in Bitcoin’s price
- MicroStrategy’s second-quarter financial results are not encouraging, and Bitcoin losses made the headlines
Bitcoin, which has critics divided over its value and utility, seems to be the primary reason why Michael Saylor is vacating MicroStrategy’s CEO office. As of writing, the blockchain-powered cryptocurrency is trading at a loss of over 50% on a year-to-date basis.
It is notable that in November 2021, when Bitcoin touched US$68,000, many analysts predicted it touching US$100,000 in 2022. This has so far remained a far-fetched dream with pain aggravated by troubles brought by the collapse of crypto participants like Celsius and Voyager. Let us explore why Saylor has decided to quit, what happens next, and is Bitcoin solely to blame here.
Michael Saylor’s exit
According to the statement by the company, Saylor is set to relinquish the CEO’s office on August 8. MicroStrategy’s President, Phong Le, will take over as the new CEO. Saylor is moving to the role of Executive Chairman.
The announcement, which includes Q2 2022 financial results, begins with a long statement on the new organisational structure. Notably, Saylor co-founded the company in 1989 and has since led the analytics software-focused business to become a name to reckon with. MicroStrategy is listed on the NASDAQ. Many might remember that the stock took a major blow during the Great Recession. This year so far, the stock is down more than 45%, as of writing.
Also read: Who is Ishan Wahi and what is crypto insider trading?
What happens next?
Saylor’s remark is included in the announcement. He has said that the company is pursuing two strategies, one of acquiring and holding Bitcoin, and the second of being an analytics software business. His move from the CEO’s office to that of the Executive Chairman’s will allow Saylor to “focus more” on Bitcoin-related activities, including acquisition and advocacy.
Phong Le as the new CEO is expected to focus on “overall corporate operations”. The company has reported a 2.6% fall in its Q2 2022 revenue as compared with Q2 2021. Le has a lot of work to do.
Is Bitcoin solely to blame?
The announcement mentions a cumulative impairment loss of over US$1.9 billion on Bitcoin since the company started acquiring the cryptocurrency with Saylor as CEO. Out of this, US$917.8 million loss accrued in Q2 2022. MicroStrategy held nearly 129,699 Bitcoins as of June 2022.
The value of Bitcoin is highly fluctuating, and the figures mentioned above might change in coming quarters. However, Saylor’s long bullish stance on Bitcoin, which does not seem to have so far worked in favour of MicroStrategy and its shareholders has become a subject of debate now.
Data provided by CoinMarketCap.com
Bottom line
Tesla sold a major chunk of its Bitcoin holding recently, and now, with Saylor quitting MicroStrategy’s CEO office, prices of cryptocurrencies might come under pressure.
Risk Disclosure: Trading in cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory, or political events. The laws that apply to crypto products (and how a particular crypto product is regulated) may change. Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading in the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed. Kalkine Media cannot and does not represent or guarantee that any of the information/data available here is accurate, reliable, current, complete or appropriate for your needs. Kalkine Media will not accept liability for any loss or damage as a result of your trading or your reliance on the information shared on this website.
