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Taking Q's for James Check (Patreon)

Published:
2025-02-06 20:46:22
Imported:
2026-06

Content

Hey team. Next Tuesday (Feb 11) James Check from Checkonchain, expert in the analysis of Bitcoin onchain data, will be hosting OCTA with me at 1pm Pacific. Post your questions for James in the comments below.

Comments

Peter Boomio

I read this from a crypto guy on LinkedIn - he has a lot of followers - name is at the bottom of his message. What does James think about this please:? You asked me to explain how Michael Saylor keeps raising billions of $ through “0% convertible debt” to buy Bitcoin? Here’s the thing: He’s NOT. Investors Who Buy Michael Saylor's Bonds are NOT Bullish on $MSTR price. Saylor is actually selling call options on $MSTR stock! This isn't magic money glitch – it’s a calculated trade-off. It’s creating a massive divide between two groups: - convertible bondholders - $MSTR shareholders. I would NEVER invest in $MSTR. I break it down 👇 1️⃣ Convertible Bonds ≠ Stock Belief People think bondholders are bullish on MicroStrategy. They’re NOT. Convertible bondholders don’t care if $MSTR stock price goes up or crashes. Why? They’re not betting on the direction – they’re trading VOLATILITY. Here’s how it works: Bondholders hedge their position by shorting $MSTR stock or via options. They have delta-neutral portfolios – they aren’t exposed to price moves. They profit from gamma trading, rebalancing their positions as $MSTR price swings wildly. It’s not about long-term belief in Saylor’s strategy. It’s about exploiting extreme volatility of $MSTR stock. 2️⃣ Who’s More Important to Saylor: Bondholders or Shareholders? Convertible bonds dilute shareholders when converted into equity. Trade-off? Bondholders make money from high volatility. Shareholders lose value due to dilution. Saylor seems more focused on keeping bondholders happy. Why? Happy bondholders mean: - Lower borrowing costs for MicroStrategy. - Endless capital to buy more Bitcoin. It’s a game of balancing priorities. Right now, volatility benefits bondholders more than shareholders. 3️⃣ Why Convertible Bondholders Love $MSTR’s Volatility Real genius behind Saylor’s play: He raises billions by issuing bonds with embedded call options on $MSTR stock. Bondholders buy these instruments not for Bitcoin exposure, but for volatility trading. Every time $MSTR stock moves: Price rises? Bondholders hedge by shorting more stock. Price falls? They buy back short positions. Constant rebalancing generates profits for bondholders, no matter the direction of the stock price. Saylor is incentivized to promote high volatility in $MSTR stock – even if it hurts shareholders. 4️⃣ Why This Strategy Is Risky for Crypto MicroStrategy now holds 2.2% of Bitcoin’s total supply, worth $46 billion. Here’s danger: If MicroStrategy ever faces a liquidity crunch or struggles to issue more debt, it could trigger: Massive Bitcoin liquidations. Panic selling across crypto markets. Collapse in market confidence. Saylor’s strategy is a systemic risk to entire crypto ecosystem. Michael Saylor’s game isn’t about stock growth or long-term fundamentals. It’s about leveraging extreme volatility to raise cheap capital. Who’s MicroStrategy prioritizing – bondholders or shareholders? For now, bondholders are winning. What do you think? Let me know in comments👇 🚀 Follow Anton Golub for sharp crypto insights.

rainbowgenie

James Check has been quite vocal in his belief that a supply crunch is unlikely, arguing that there will always be sellers. He has previously suggested that data points to a top in the $120K–$140K range. Given the increasing institutional interest from companies like MicroStrategy, BlackRock, and others, has he since revised his outlook?