Here’s how Michael Saylor’s Bitcoin finance company, Strategy, works. The company will raise funds to purchase Bitcoin. When you buy, the price of Bitcoin increases. Strategy’s stock price follows suit. Rinse and repeat. The deal was so lucrative, fueled by Thaler’s full confidence that he was a hype capitalist on par with OpenAI Inc.’s Sam Altman, that it spawned dozens of imitators targeting the same “infinite money glitch,” like a video game cheat code.
However, a problem has occurred. Bitcoin’s price has fallen below $90,000 and is approaching the $74,000 average price Bitcoin paid for its stash of 650,000 coins, making it difficult for Strategy to sustain its numerical boost. Counterfeit companies and investment vehicles are competing for Strategy’s premium, with French entrepreneur Eric L’Archebeck recently announcing the creation of a Bitcoin finance company. In addition to the speculative appeal, these Saylor imitators claim to be hedging against inflation by pouring their capital reserves into the apparently safe haven of Bitcoin.
