Michael Sayer, CEO of business intelligence firm Microstrategy, believes the financial market is not ready for bitcoin-backed bonds. Meanwhile, El Salvador has postponed the launch of its BTC-backed Volcano Bond.
Now is not the time for bitcoin-backed bonds
In a recent interview with Bloomberg, the CEO of Microstrategy, while not generally opposed to bitcoin-backed bonds, believes that now is not the time to launch a project like this.
“I would love to see a day where people finally sell mortgage-backed securities like bitcoin-backed bonds. The market is not quite ready for that yet. The next best idea was a term loan from a major bank.” – he said.
The CEO’s comment comes as El Salvador seeks to launch a $1 billion bitcoin bond. Speaking about the Bitcoin-backed Volcano Bonds in the Central American country, the microstrategy chief said:
“It is a hybrid sovereign debt instrument, as opposed to pure bitcoin-treasury play. It has its own credit risk and is completely unrelated to bitcoin risk.”
As previously reported by cryptopotatoEl Salvador was gearing up to launch its 10-year bitcoin bond. The expected proceeds of $1 billion will be split in two, half of which will go to BTC investments, and the rest will be used to develop the much-loved “Bitcoin City”.
However, earlier in March, the launch date was postponed, with El Salvador Finance Minister Alejandro Zelaya citing unfavorable market conditions as the reason for the delay.
Sailor says the $205 million loan was the best financing option
MicroStrategy subsidiary MacroStrategy recently secured a $205 million loan from Silvergate Bank, a division of Silvergate Capital Corporation, collateralized by Bitcoin Holdings. As part of the agreement, Macrostrategy will use the loan to purchase BTC, pay fee interest, and take care of debt-related expenses.
Meanwhile, Sayer said obtaining the loan was the best decision for the company’s shareholders. The microstrategy CEO said that various financial options such as issuing bitcoin-backed bonds, lending BTC and leveraging decentralized finance (DeFi) tools are considered.
Saylor is one of the most prominent bitcoin proponents in the industry. The CEO’s business intelligence company has been hoarding BTC since 2020 and is currently the largest corporate holder of bitcoin, holding over 125,000 BTC.
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