Michael Saylor says bitcoin has likely bottomed, quantum risk overblown

Speaking at a Mizuho event, the Strategy (MSTR) executive chairman said the formation of banking credit pairing with digital credit will be the catalyst for the next bull market.

What to know:

• Bitcoin likely bottomed near $60,000 in early February when forced sellers were flushed out, said Michael Saylor at a Mizuho event.
• Bitcoin's next price surge could come from the development of banking and digital credit markets built on BTC.
• The quantum threat to bitcoin is theoretical and likely decades away, he argued.

Michael Saylor, executive chairman of Strategy (MSTR), believes bitcoin likely bottomed in early February at $60,000.

Speaking at a recent Mizuho event, Saylor reiterated his long-held view that bottoms aren't necessarily about valuations but are driven by seller exhaustion, analysts Dan Dolev and Alexander Jenkins wrote.

Trend reversals, he added, are driven more by capital structure and liquidity than by investor sentiment.

Saylor now sees limited selling pressure amid growing demand from ETF inflows, which are absorbing daily supply, and companies shifting treasury assets into bitcoin.

Bitcoin and Strategy’s next drivers

As for the catalyst for the next bull market, Saylor believes it will be the formation of banking credit and digital credit on top of bitcoin. This will have bitcoin supporting more lending and credit activity beyond simple buy-and-hold demand.

Digital credit already exists, said Saylor, in the form of Strategy's STRC preferred stock, whose beefy 11.5% yield remains well below the company's expectation of BTC's long-term appreciation. Strategy is “stretching” bitcoin “from a nonyielding asset into a capital markets engine," he said.

On the recently hotly-debated topic of quantum computing, Saylor said the risks are overblown. The threat, he argued, is theoretical, likely decades away, and even then solvable.

Mizuho retained its outperform rating on Stategy and $320 price target, suggesting about 150% upside from the current $127.

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