MicroStrategy’s Saylor Says Market Unprepared for Bitcoin Bonds

Financial market is “not quite ready” for bitcoin-backed (EXANTE: Bitcoin) bonds, MicroStrategy CEO Michael Saylor said in an interview with Bloomberg. Saylor, who oversees the company that hodls 125,051 BTC on its balance sheet, said that besides a loan from Silvergate Bank, the next best idea was a “term loan from a major bank.”

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His comments also correlate with El Salvador’s plans to sell $1 billion of “volcano bonds” backed by the cryptocurrency:

“There is a lot of talk about the El Salvador bitcoin bond. That is a hybrid sovereign debt instrument as opposed to a pure bitcoin-treasury play. That has its own credit risk and has nothing to do with the bitcoin risk itself entirely.”

Saylor’s statements come after MacroStrategy, a subsidiary of MicroStrategy, got a $205 million loan from Silvergate Bank to buy additional bitcoins. The company said that the deal is secured by “certain bitcoin” held in MacroStrategy’s collateral account. MicroStrategy CEO Michael Saylor added that with the capital from the loan, the company has turned its bitcoin into “productive collateral.”

Michael Saylor: MicroStrategy’s Shares Are the Best Alternative to Bitcoin ETFs

Last December, Saylor said MicroStrategy was looking for a way to generate yield on its bitcoin holdings. He noted back then that there “may be opportunities to either put a mortgage against it and generate long-term debt under favorable circumstances.” The MicroStrategy CEO also suggested the company could simply “lend it [bitcoin] to a trustworthy counterparty.”

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