Well, the S&P 500 is at all-time highs, up 14% since the beginning of the year, and everything seems to be going great.
And at the same time? Two people that all of Wall Street listens to are making completely opposite moves. One is selling something he swore he would never sell in his life, while the other says that the entire AI story hinges on just two companies.
Both predicted a crisis in the past and were right. What about now?
Let’s break it all down.
Michael Saylor built his entire image around one phrase: Never sell. I never sell.
A few months ago, however, that ended.
Strategy announced a shift. Instead of “I hold no matter what,” the company is moving toward active balance-sheet management. What does that mean? It means it can now sell bitcoin if doing so improves bitcoin per share, if it needs to pay dividends, or if it needs to strengthen its position.
“We want to be net aggregators of bitcoin,” CEO Phong Le said. “To increase our total bitcoin, but especially bitcoin per share.”
And in June came the first sale, with 32 BTC. A tiny number, but with enormous symbolism. Because it was only the second time in the company’s history. The first was in December 2022, when FTX was collapsing and the entire market was on fire.
And this is exactly where STRC comes into play. What is it? In very simple terms, it is a preferred security issued by Strategy that pays a fixed income. Instead of buying bitcoin, you are buying income backed by the company’s balance sheet.
You might say, “32 coins? That’s nothing.” True. But it didn’t stop there.
Look at what happened just over the past month.
In the week ending August 2, Strategy sold 1,638 bitcoin at $63,957 each. Total: $104.73 million. And where did the money go? $52.4 million toward STRC dividends and $52.3 million toward buybacks.
The following week, it happened again. 1,900 bitcoin at $64,262, another $108.6 million, all used to repurchase 1.15 million STRC shares. At the same time, it raised $653.1 million by selling its own shares, putting $650 million into its dollar reserve, which reached $4.65 billion.
And now comes the part we need to pay attention to.
Strategy’s average acquisition cost is $75,385 per bitcoin. And it is selling at $64,000.
Yes, you read that correctly. IT IS SELLING AT A LOSS.
“So it’s selling cheap what it bought expensive?” you might be wondering. Exactly. Its holdings fell from 843,775 to 840,450 bitcoin. And Phong Le has one goal: for STRC to remain consistently around $99 to $100.
And as if that weren’t enough, STRC pays a $0.50-per-share dividend twice a month. That means it constantly needs liquidity. And there are still $22.04 billion in common shares and more than $25.2 billion in preferred shares outstanding.
For now, bitcoin is below $64,000. Approximately 50% below its all-time high of $126,000.
Now let’s move on to the second part, which has nothing to do with crypto.
Steve Eisman is the guy who bet against the housing bubble before 2008. The one who became famous through The Big Short, yes, just like Michael Burry, and now he has said something that has made a lot of people think.
He says the entire AI boom depends on just two companies: OpenAI and Anthropic.
Why? Because these two account for roughly 70% of AI-related revenue at Microsoft, Amazon, Google, and Oracle. And for 25% to 35% of their total cloud revenue.
“The future of these giants is, in a sense, a bet that OpenAI and Anthropic will succeed,” he said.
And where is the Achilles’ heel? China.
Chinese open-weight models are much cheaper and, according to him, appear to be gaining market share. And if that happens, a price war is coming. And then, in his own words, “we have a problem.”
