First bear market? This is also the first Bitcoin (BTC) bear market for Michael Saylor, one of the world’s biggest Bitcoin bulls.
The executive chairman of one of the world’s largest bitcoin backers, Saylor took time out of his busy schedule at the Los Angeles Pacific Bitcoin Conference to speak with Cointelegraph. Importantly, Saylor told Cointelegraph that when it comes to Bitcoin, “you have to look long term.”
“If you buy [Bitcoin] and you have a horizon of less than four years, you just speculate on it. And once you have a time horizon of more than four years, obviously you get the average dollar value.”
Dollar cost averaging is a way to reduce exposure to investment volatility. Saylor continued, “You’re buying an asset that you want to hold for ten years or longer, which is a long-term store of value.”
At 130,000 BTC, MicroStrategy owns 0.62% of the total bitcoins, as the total amount of bitcoins mined is capped at 21 million. MicroStrategy has a starting price of approximately $30,639 per BTC, which means the technology group’s total investment is significantly lower – if they were selling it for dollars.
However, Sailor is embarrassed by the loss – on paper – of billions of dollars, stating, “Don’t obsess and look at the price day after day, week after week.”
The billionaire compares the valuation of bitcoins 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 11 pm or midnight you come up and say, ‘How much will you pay for my house? I want to sell you my whole house right now. Someone might say, “Well, I’m not really in the mood to buy a house. I’ll give you about half of what you paid for it” and then you’ll go home depressed saying, “I’ve lost all my money.”
Related: Bitcoin May Need $1 Billion More Losses Before BTC Price Bottoms Out
Avoid that worry, he advised, and if you really need the money in the next 12 months, it’s not an investment; instead, Sailor explained, “It’s working capital.”
“The logical model is this: if you live in Argentina, you have pesos for a month or two, you have dollars for a year or two. You hold bitcoin for a decade or two. And when you think about it in those frequencies and time frames, everything starts to make sense.”
Finally, as Sailor and Binance CEO Changpeng Zhao suggested, take custody of your bitcoins. In light of another cryptocurrency exchange disappearing along with client funds, taking custody of bitcoins is the only way to ensure property cannot be confiscated.