MSTR Masterclass with Ben Werkman of NumerisX — New Foundations E30
Mar 21, 2025
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Ben Werkman, Founder of NumerisX and a leading voice in the MSTR True North community, dives deep into innovative Bitcoin strategies for businesses. He elaborates on how firms can navigate Bitcoin's volatility and the importance of effective treasury management. The conversation touches on MicroStrategy’s transition to secured debt amid market fluctuations and discusses governance frameworks to mitigate investment risks. Ben also compares financial products like STRK and STRF, revealing their implications for corporate finance in the evolving landscape of Bitcoin.
Holding Bitcoin for over four years can mitigate volatility and align with long-term bullish sentiments towards the cryptocurrency.
MicroStrategy's innovative capital-raising strategies, such as convertible debt and preferred stock offerings, have positioned it as a leader in Bitcoin treasury management.
The growing focus on secure custody solutions like multi-signature arrangements is essential for institutional confidence in holding large amounts of Bitcoin.
Deep dives
Holding Bitcoin for the Long Term
The discussion emphasizes the importance of holding Bitcoin for extended periods, ideally over four years, to reap substantial benefits. This approach not only allows investors to weather Bitcoin's price volatility but also aligns with a long-term bullish sentiment towards the cryptocurrency's viability. The speaker recounts personal experiences where early missteps turned into lessons on the value of accumulating Bitcoin steadily. Such narratives highlight the necessity of learning from trading mistakes to foster a more committed investment strategy.
MicroStrategy's Innovative Capital Strategies
MicroStrategy has become a prominent player in the corporate equity market by acquiring Bitcoin and developing unique capital-raising strategies, such as convertible debt and preferred stock offerings. This approach has positioned them at the forefront of Bitcoin treasury management, enabling them to leverage their Bitcoin assets effectively. The discussion explores how these financial innovations enable MicroStrategy to raise capital at rates faster than Bitcoin's price appreciation, thus increasing their Bitcoin holdings in value terms. The potential impact of these strategies on both MicroStrategy's growth and the broader acceptance of Bitcoin in corporate finance is significant.
Evolution of the Bitcoin Custody Landscape
The podcast delves into the risks associated with Bitcoin custody, particularly for large corporate holders like MicroStrategy. As they own a substantial amount of Bitcoin, the importance of securing these assets properly becomes crucial to avoid catastrophic loss. The conversation notes that new solutions are emerging for institutional custody, including multi-signature arrangements and partnerships with established financial institutions. This evolution is seen as vital for fostering a secure environment for Bitcoin holdings and increasing institutional confidence in the asset class.
Market Dynamics and Future Predictions
A significant portion of the dialogue focuses on the dynamics elicited by MicroStrategy and its effect within the broader cryptocurrency market. The expectation is that if MicroStrategy continues its current trajectory of capital raises and Bitcoin purchases, it could influence market prices favorably. Moreover, the speaker discusses the potential for the U.S. government to acquire Bitcoin, sharing thoughts on how strategic reallocation of existing reserves could facilitate this. As future trends in the market unfold, the speaker believes there will be evolving adoption rates and integration of Bitcoin within financial systems.
Diversifying Investment Strategies in Bitcoin
Listeners are encouraged to explore diverse investment strategies concerning Bitcoin, especially for risk mitigation and passive income generation. The conversation highlights the allure of MicroStrategy's preferred offerings as a vehicle for generating yield while still maintaining exposure to Bitcoin's price movements. Additionally, strategies like borrowing against Bitcoin are discussed, with caution offered regarding current high-interest rates. This diversified approach empowers investors to better manage risk while capitalizing on potential Bitcoin market growth.
New Foundations: a weekly podcast covering the need for businesses to embrace Bitcoin, as both a reserve asset and a disruptive settlement layer. Hosted by Mason Carter, Chase Palmieri, and rotating guests. The show is presented by Acropolis, the comprehensive treasury solution for the Bitcoin age. Acropolis believes that every business will hold Bitcoin, and it works to pull that future into the present. Visit acropolistreasury.com to learn more.
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