5 ms·

The margin call from hell (Bitcoin at $21k)

26 points by marban 4y ago

marban 4y ago
Perhaps someone can elaborate on the chances this getting triggered.
- edmcnulty101 4y ago
  It's fallen from an high of 68,000 to what it is now. I don't know why it wouldn't continue to drop.
  - guenthert 4y ago
    Which is about $23k (down 17%!) for those (like me) who don't track Bitcoin that closely. https://finance.yahoo.com/quote/BTC-USD?p=BTC-USD&.tsrc=fin-srch https://finance.yahoo.com/quote/BTC-USD?p=BTC-USD&.tsrc=fin-... Bitcoin is an ecological disaster. It won't be missed.
    - edmcnulty101 4y ago
      I love crypto but other than privacy coins the value proposition is low. Hashes and wallets and private keys are too technically dense for the layperson to use who can just barely attach a document to an email. Privacy is what Bitcoin originally build its market share on with the darknet markets. That's really where the value lies in my opinion. Now I could be totally wrong and I hope I am because it would be really cool to see some form of crypto as an legit alternative currency to USD.
- coip 4y ago
  “It was written the day saylor mentioned their position” or something like that
breakyerself 4y ago
Crypto is dogshit. The stupidest asset since the tulip bubble, but at least tulips can make your house or funeral look nice.
- whoomp12342 4y ago
  if you hold a virtual funeral, bitcoin can make it virtually sparkle
  - breakyerself 4y ago
    Lol I hadn't considered that.
frankbreetz 4y ago
>>the company’s holdings were worth just over $3 billion. Its market cap, on the other hand, is roughly $1.77 billion. Why doesn't someone aquire the company and sell all of the Bitcoin? Seems like an easy way to make a lot of money.
- cypress66 4y ago
  Because market cap is price * shares. And price is the price of the last trade. You wouldn't be able to get every shareholder (or 51%) to sell you for that price.
- goo 4y ago
  They have debt too. It’s clickbait style writing.
goo 4y ago
The collateral limit getting triggered isn’t a particularly big deal: it just means that MSTR needs to quickly furnish more BTC as collateral or they’ll be in breach of loan covenants. But they HAVE a ton of BTC, so there’s no effect on the market. The only way this gets interesting at all is if the total bitcoin owned by mstr starts approaching the price of the loan (which it’s not even close to, but that’s the point where silvergate could lose some money…) Really all the margin call does is reduce the amount of additional debt collateralized by bitcoin that MSTR could take on. It’s clickbait!
syspec 4y ago
So it did dip below 21k, what happens now? I imagine they have a grace period, I doubt they bank would want it start the spiral

26 points by marban 4y ago

marban 4y ago

Perhaps someone can elaborate on the chances this getting triggered.

edmcnulty101 4y ago
It's fallen from an high of 68,000 to what it is now. I don't know why it wouldn't continue to drop.
- guenthert 4y ago
  Which is about $23k (down 17%!) for those (like me) who don't track Bitcoin that closely. https://finance.yahoo.com/quote/BTC-USD?p=BTC-USD&.tsrc=fin-srch https://finance.yahoo.com/quote/BTC-USD?p=BTC-USD&.tsrc=fin-... Bitcoin is an ecological disaster. It won't be missed.
  - edmcnulty101 4y ago
    I love crypto but other than privacy coins the value proposition is low. Hashes and wallets and private keys are too technically dense for the layperson to use who can just barely attach a document to an email. Privacy is what Bitcoin originally build its market share on with the darknet markets. That's really where the value lies in my opinion. Now I could be totally wrong and I hope I am because it would be really cool to see some form of crypto as an legit alternative currency to USD.
coip 4y ago
“It was written the day saylor mentioned their position” or something like that

breakyerself 4y ago

Crypto is dogshit. The stupidest asset since the tulip bubble, but at least tulips can make your house or funeral look nice.

whoomp12342 4y ago
if you hold a virtual funeral, bitcoin can make it virtually sparkle
- breakyerself 4y ago
  Lol I hadn't considered that.

frankbreetz 4y ago

>>the company’s holdings were worth just over $3 billion. Its market cap, on the other hand, is roughly $1.77 billion. Why doesn't someone aquire the company and sell all of the Bitcoin? Seems like an easy way to make a lot of money.

cypress66 4y ago
Because market cap is price * shares. And price is the price of the last trade. You wouldn't be able to get every shareholder (or 51%) to sell you for that price.
goo 4y ago
They have debt too. It’s clickbait style writing.

goo 4y ago

The collateral limit getting triggered isn’t a particularly big deal: it just means that MSTR needs to quickly furnish more BTC as collateral or they’ll be in breach of loan covenants. But they HAVE a ton of BTC, so there’s no effect on the market. The only way this gets interesting at all is if the total bitcoin owned by mstr starts approaching the price of the loan (which it’s not even close to, but that’s the point where silvergate could lose some money…) Really all the margin call does is reduce the amount of additional debt collateralized by bitcoin that MSTR could take on. It’s clickbait!

syspec 4y ago

So it did dip below 21k, what happens now? I imagine they have a grace period, I doubt they bank would want it start the spiral