Bear market for the first time? It is also the first Bitcoin (BTC) bear market for Michael Saylor, one of the biggest Bitcoin bulls in the world.
The executive chairman of one of the largest pro-Bitcoin companies in the world, Saylor took a moment out of his busy schedule at the Los Angeles Pacific Bitcoin conference to speak with Cointelegraph. Basically, Saylor told Cointelegraph that when it comes to Bitcoin, “you have to have a long-term time perspective.”
“If you are buying [Bitcoin] and you have less than a four year time horizon, you’re just speculating about it. And once you have more than a four-year time horizon, then the obvious thing is your average dollar cost.
Dollar cost averaging is one way to reduce an investment’s exposure to volatility. Saylor continued, “You buy the asset you want to keep for a decade or more, which is the long-term store of value.”
At 130,000 BTC, MicroStrategy holds 0.62% of the total Bitcoin supply, as the total Bitcoin mined is capped at 21 million. MicroStrategy’s entry price is around $30,639 per BTC, meaning the tech group’s total investment is essentially under water, if they were selling for dollars.
However, Saylor is puzzled by the loss – on paper – of billions of dollars, stating, “Don’t get caught up and look at the price day-to-day, week-to-week.”
The billionaire compares the valuation of Bitcoin to the valuation of a house. He joked that “if you bought a house and then every time you went to a party, you got drunk, and then at 11pm or midnight, you walked up and said, ‘How much are you going to pay for my house? I want to sell you my whole house right now.’ Someone might say, “Well, I’m just not in the mood to buy a house. I’ll give you about half of what you paid for it,” and then you’ll come home despondent, saying, “I lost all my money. ‘”
Related: Bitcoin May Need $1B More On-Chain Losses Before New BTC Price Hits Bottom
Avoid that anxiety, he advised, and if you really need the money in the next 12 months, it’s not investable capital; instead, Saylor explained, “It’s working capital.”
“A logical model is if you live in Argentina, hold pesos for a month or two, hold dollars for a year or two. You’re holding Bitcoin for a decade or two. And when you think about those frequencies and time frames, it all starts to make sense.
Finally, as suggested by Saylor and Binance CEO Changpeng Zhao, take custody of your Bitcoin. In light of another cryptocurrency exchange vanishing with customer funds, taking custody of Bitcoin is the only way to secure property that cannot be confiscated.