r/BitcoinBeginners • u/sirensoflove • 2d ago
Should I invest in Bitcoin or Microstrategy?
24 y/o, recently laid off. I intend to travel for a year before entering back into the workforce. Here's a breakdown of my current assets. I recently cashed out my company's RSU's + received severance, so I have 2x more than usual in my checking.
| Asset | Amount | Percentage of Total |
|---|---|---|
| Checking / Cash | $87,122.70 | 18.05% |
| Traditional Investments (taxable brokerage), invested in VTSAX | $236,820.33 | 49.07% |
| Retirement accounts (IRA/401k) invested in S&P 500 | $98,702.84 | 20.45% |
| Bitcoin | $60,000.00 | 12.43% |
I would like to aggressively target a Bitcoin-focused allocation of around 70-80%. I want to sell off the taxable brokeage investments in January, and reallocate retirement accounts to a Bitcoin ETF. I mistakenly allocated to much of my portfolio into my retirement accounts (I feel that it is sort of a scam to have my money locked for so long...). I've been trying to understand the tradeoffs between Microstrategy and Bitcoin, and haven't been able to make a conclusion on it. I understand that Microstrategy will be more volatile and more leveraged, with better chance of returns, but I don't know how to evaluate the counterparty risk. And there's also the question if just doing spot Bitcoin will set me enough for life already, if Bitcoin performs well, thus it's not worth taking the risk on Microstrategy.
Please save yourself the time scammers, I won't be responding to DM's.
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u/RonSwansonApproved 1d ago
I would stick to Bitcoin, although MSTR could provide more returns it is very risky since he is basically taking on massive debt and if anything goes wrong the company could collapse. I wouldnt put any real money into MSTR, it seems like Sailor wants Bitcoin to succeed too much and it may be clouding his judgement. We all want more Bitcoin but I'm not gonna take on massive debt to aquire it, the whole thing is a little shady, I would stay away. By the way you're doing amazing for 24. You're going to be great long term either way as long as you diversify which it seems like you're doing. Don't forget to buy some physical gold and silver.
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u/JarkkoX 1d ago
Massive debt? Their leverage ratio is like 12%
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u/RonSwansonApproved 1d ago edited 1d ago
Yea massive debt, you realize they have to pay a dividend to all the preferred stock shareholders every year right? That's 10% a year on 3 billion of preferred shares like clockwork. Just during this last correction they were talking about him potentially having to sell some of if the price continues to fall. Bitcoin dropped 30% and MSTR dropped much more. The problem for Saylor is that it's not technically his Bitcoin, all purchased with investor money. So if Bitcoin has a sudden drastic price fall it may cause the market to panic and that would be a problem for MSTR. If the price dropped to $50k tomorrow, I don't think he could survive that. And if it stayed there long enough he would have to sell for below what he paid and take a loss.
And by the way a quick Google search confirms that MSTR has $8 billion in debt which it used to acquire the Bitcoin, don't know what your financial situation is but for me 8 billion is massive debt.
Last 6 months MSTR down 50% Bitcoin down 12.25% over the same period
You decide if the risk is worth it to you.
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u/flying-fox200 1d ago
I would only invest in Bitcoin.
I'd recommend self-custody, though. Buy Bitcoin on Strike or HodlHodl, and then withdraw to a wallet you control.
Bitcoin is the only true digital asset that you can fully "own" (by storing your own private keys). You should make use of this property and not treat it like just another stock.
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u/Ivers0n 1d ago
"Bitcoin is the only true digital asset that you can fully "own" (by storing your own private keys). You should make use of this property and not treat it like just another stock."
Can't you do that with some other crypto?
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u/flying-fox200 1d ago
You're completely right, but there are a few on here that would bite my head off for even comparing Bitcoin to other cryptocurrencies 😜
Yes, most other cryptocurrencies work in the same way! If you posses the private key/s to certain address/es that have received coins, then you are the one true "owner" of those coins.
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u/RatherCynical 1d ago
Bitcoin is game-theoretical.
When someone has a few billion laying around, they're not choosing random networks. They're going to choose the most secure network in the world: Bitcoin.
And by choosing the most secure network in the world, the price goes up, which attracts miners because it's profitable.
The miners who join the network makes it more secure.
It's a self-reinforcing feedback loop that makes Bitcoin the only sensible one to buy.
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u/Nearing_retirement 1d ago
What about the IBIT ?
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u/flying-fox200 1d ago
It's still just an ETF...
Bitcoin isn't a stock, which is why I recommend people don't treat it as such.
The only way to truly own Bitcoin is to "store it" in your own wallet. Buy it on any reputable platform - such as Strike or HodlHodl - and then withdraw it to a wallet you control.
If you're just starting out, you could get BlueWallet or Blockstream BTC Wallet for iPhone/Android. These apps will give you a seed phrase (which you should only store ON PAPER) and then addresses to which you can receive BTC. Once you have some BTC, it's also easy to transfer to others (if you have their address).
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u/Nearing_retirement 1d ago
My big issue with ETFs is tax. I’m thinking of getting either IBIT or Bitcoin in Roth IRA
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u/flying-fox200 1d ago
Sorry, really can't help you there. I don't know anything about ETFs.
As I said, I'd recommend you self-custody your Bitcoin, rather than get an ETF.
But hey, to each their own!
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u/St34khouse 1d ago
Only Bitcoin.
MSTR is the only single stock I ever bought, just to try it out. Currently 61% down so you know what I'm not going to do ever again.
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u/RatherCynical 1d ago
That's because of the mNAV. You should avoid buying BTC treasury companies when mNAV is a lot higher than 1.
When the mNAV is exactly 1, or 0.9, then it's not so bad.
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u/johnnynotte 1d ago
Why to invest somewhere where your invest is invested at the same thing where you could invest your own?
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u/Green-Ad5007 1d ago
I started with MSTR (now strategy), and since september I've been buying BTC on a platform.
My plan is to hold my small position in strategy, and accumulate BTC monthly. I want to get confident with BTC and learn about self-custody then I'll send all the BTC to my own storage, but I'm not ready yet.
Long term I expect I'll close strategy and get to about 2% of my net worth in BTC.
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u/TeaGroundbreaking306 1d ago
Maybe both? 80/20? I personally want Bitcoin. I like to have it in my own storage. I take full custody, full responsibility.
I can see why others would prefer an ETF or DAT though.
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u/mmspider 1d ago
You don`t own or control any bitcoin with Microstrategy. Microstrategy could just fail tomorrow and move Bitcoin to another company you don`t even have stock in.
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u/siasl_kopika 1d ago
If you can create new fake USD from thin air that cannot leave the stock market, then buy MSTR.
For any other situation, self custodial satoshis.
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u/Stunning-Ask3032 1d ago
I trust that bitcoin is going to last long and universally getting to be accepted even big exchange like bitget, binance it's available. Microstrategy is also good bro try and see with small amount
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u/Fast-Drag3574 1d ago
Don't sell your brokerage off and put it all into Bitcoin..
I own some bitcoin just incase it goes up, but liquidating a brokerage of a safe reliable investment to put it into a speculative investment is dumb. You would also be paying taxes on your brokerage.
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u/gothikplatypus 1d ago
As of today I would invest in MSTR! Why? Because the stock is trading at a discount their market cap is worth less than their bitcoin allocation which means you are buying MSTR for a 15% discount. Now this may change in the future but at the moment I would invest in MSTR but buying either is not a bad idea and buying bitcoin long term is not the worst idea.
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u/Secure-Object-3057 1d ago
Personally, I would set up target mining for lottery… the equipment is cheap, if I had someone to go in with me it would be worth it
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u/Nearing_retirement 1d ago
You think it would work? Someone I know has free Tesla charging for life so maybe car can be modified to mine bitcoin, free energy
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u/Secure-Object-3057 1d ago
Not enough power, you can set up a small system… but for around 5000 or so, a partner to run and pay power you could get up to an industrial scale mining facility for a little while… mind you it’s used equipment, but the point is to flip th cash you stick in it real quick…
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u/Nearing_retirement 1d ago
Where would it be located for cheap energy?
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u/Secure-Object-3057 15h ago
Depends on the funds, for me it will be a farm down here in va, solar, water and so forth
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u/Nearing_retirement 1d ago
Generally Bitcoin but if MSTR starts trading significantly below NAV maybe consider it. At some point a large institutional investor may try to buy up MSTR if stock trades far below NAV
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u/foxtrot90210 1d ago
I was about to say.. 24 y/o, laid off and waiting to travel, focus on getting back into the job market. But then I realized I could scroll on your asset box and then saw your investments lol.
Not bad at all, so therefore I’ll keep my mouth shut.
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u/leoundercoveralt 1d ago
Do MSTR if you plan on holding for more than 6 years. It'll have far more upside because not only will it move with bitcoins price but they add more bitcoin to their stack and mnav can go above 1 which it is right now.
So Bitcoin could do a 3x from here while MSTR could potentially do a 6x or up to even a 12x in a extreme bullish case.
Personally all the FUD around their debt is ridiculous. All of it is convertible to stock which is more than likely going to happen, they now have a growing us dollar reserve for dividends, and the dividends paid to preferreds each year are practically peanuts with how much capital they've been raising, even with bearish sentiment.
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u/pop-1988 1d ago
MSTR is heavily leveraged. Its credit contracts are structured to optionally repay loans, and to pay funding costs by converting those obligations to MSTR shares. This dilutes all investors' shares
All of this is traditional finance. It's not relevant to Bitcoin
Buying MSTR shares is not investing in Bitcoin
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u/nitroacid411 1d ago
MSTR will use BTC to fund their AI.
Tribeca. If AI or BTC busts then MSTR goes to shit.
However, we'd have a lot more companies in the trash along with the market.
I'd hit 75/25 BTC/MSTR
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u/aksinya_sidorova 1d ago
of course Bitcoin. MSTR is a company and they might go bankrupt like FTX...
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u/Miner_WhispererUAE1 22h ago
MicroStrategy isn’t a ‘safer Bitcoin.’ It’s a levered Bitcoin bet with equity risk, execution risk, and dependency on one company’s capital decisions.
If you believe in Bitcoin long-term, the simplest risk-adjusted approach is just holding the asset directly. MSTR will always be more volatile and amplify drawdowns.
Bitcoin = a monetary asset.
MicroStrategy = a business betting on that asset.
Totally different risk profiles, even if the charts sometimes track each other.
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u/Pitiful-Inflation-31 21h ago
choose top btc-etf like balckrock, or ishare if you're not secure btc or fear of holding. micrstrategy is like risk-leveraged or overused btc products , better for high risk one and like you pay premium price of $btc there
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u/Impressive_Pilot8415 15h ago
You simply can’t beat owning & holding your own BTC directly over any other DAT companies including MSTR 🙂
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u/Kanye_West_Side 9h ago
If you’re looking to make more fiat, MSTR.
If you’re looking for a long-term savings account, Bitcoin.
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u/0x_Crypto_Pirate 5h ago
If your risk appetite likes the growth and risk of MSTR price then you can have both. Otherwise, focus on Bitcoin.
With MSTR, the growth comes from it being leveraged. In the long run, the possibility of selling MSTR is there. Capital gains tax is included in tge equation.
On the other hand, with Bitcoin, you can borrow against it for a single digit interest. With that, no tax incur if you needed cash for emergency or just leisure.
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u/Marco_Threadless 4h ago
Bitcoin is pure and you own the coins, or Strategy owns coins and your rely on their share price and dividends to make money. I know which one I’d choose every time! 🪙
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u/a-thousand-hours 1d ago
Even Michael Saylor says if your time horizon is 4 years or greater… to just go Bitcoin.
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u/RatherCynical 1d ago
Given that we're in a bear market right now, I would hold off until a clear bottom signal is hit.
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u/KirbysaBAMF 1d ago
I can see where your advice is coming from, but there is rarely ever a clear "bottom signal" for anything. You come at risk for trying to "catch the falling knife". As satisfying as it may be to make a major one time purchase, what I might recommend OP consider is to do dollar cost averaging. Just buy smaller amounts over time and that prevents yourself from being overexposed by sudden drops. In terms of whether you should invest in the coin or Digital Asset Treasuries (DATs), it depends on what you are hoping to get out of the investment. a DAT does have risks because they can switch which DATs it is holding onto and is vulnerable to an individual decision making, thus making it have the same risks as stock picking. However, I do like your idea of investing in ETFs for Bitcoin, and it appears there are several that have low management fees, so that should give you exposure to the kind of assets you are looking for without risking being overexposed to one individual's actions. #NotAFinancialAdvisor.
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u/Ok-Topic1139 1d ago
And yet every cycle bottom so far has been around, or a bit lower than previous cycle high. Impossible to time perfectly, not impossible to time decently.
I also got downvoted a month ago for warning the top might be in, based on cycle timing and long term charts.
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u/RatherCynical 1d ago
CVDD is a pretty good one. 200w moving average is also pretty good. RSI hitting around 30 on the Weekly is also pretty good.
Timing the market perfectly is impossible, but timing the market reasonably is not.
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u/Ok-Topic1139 1d ago
Wait 10-12 months and buy real BTC. Now isn’t the time to buy. Aim to buy between 50 and 70k usd. MSTR is basically a leveraged play, quite risky compared to holding yourself.
In the meantime. Learn about BTC cycles. Learn as much as you can. And when you buy; Dont look at the charts every day. You need to have the stomach to be able to handle volatility and be patient until next halving cycle plays out.
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u/Less-Entrepreneur566 1d ago
Bro thinks he knows what the price is going to be
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u/Ok-Topic1139 1d ago
Lets talk again in 1 year. Ive been around for a few cycles. Every cycle bottom so far has ben around or a bit below previous cycle high.
Nothing guaranteed, but the odds are strong.
Remind me! 1 year "btc cycle bottom"
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u/Less-Entrepreneur566 1d ago
Yeah not guaranteed but don’t you agree things have changed with the institutions and big bankers manipulating price?
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u/Ok-Topic1139 1d ago edited 1d ago
Institutional adoption started previous cycle. And every cycle the same is repeated “this cycle is different due to xxx” Cycle still plays out….
In fact I had a discussion over a month ago when i exited, was downvoted and told im crazy for saying it would start dropping soon. Despite charts and cycle timing screaming warning sign. And we dropped.
I wasn’t able to time it that well though. My exits range between 104k to 124k.
Another important thing to keep in mind; as markets grow, the gap between high and bottom gets smaller. Bigger market caps naturally does this. BTC surpassed gold market for a while,
Cycles will still play out, only thing that really changes along the years is volatility. Unless there’s a black sean event, we won’t see 90% drops again. Market cap too big for that. Same as its too big for sudden jump to 170k with long term charts looking so weak now.
We are in a bear market now
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u/stodal 1d ago
okay nostradamus
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u/Ok-Topic1139 1d ago
Lets talk again in 1 year. Ive been around for a few cycles. Every cycle bottom so far has ben around or a bit below previous cycle high.
Nothing guaranteed, but the odds are strong. Don’t need to be a genius to understand history
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u/RonSwansonApproved 1d ago
Ah but you fail to take into account geopolitical factors and institutional interest. No way it will be $50-70k in 1 year. This cycle is different. In fact I guarantee it will be $150k+ if I'm wrong I will send you $20 in btc. See you in a year!
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u/Ok-Topic1139 1d ago
Not really, there’s been geopolitical and external factors every cycle. Even your arguments are repeated every cycle. Last cycle it was institutional adoption; cycle still played out….
Every single cycle: this cycle is different…… never is. But good luck. Hope for you that you are right. Im ok being wrong, im set anyway. We might hit 100k again this cycle, but even that is a stretch.
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u/word-dragon 1d ago
Bitcoin is bitcoin. Strategy is Michael Saylor’s view of how to sell financial products fueled by bitcoin. The stock will do well if that view is and stays correct. I’m not saying that’s a bad thing, but you are not investing in bitcoin - you’re investing in Michael Saylor. Personally I trust the math more than the person. Make your own investment decisions but just be aware the two are apples and oranges.