Crypto Analyst Flags Convertible Debt-Induced Liquidation Risk To Michael Saylor’s MicroStrategy
Posted On November 28, 2024
Influential cryptocurrency analyst Willy Woo shared his perspective on the potential liquidation risk of MicroStrategy Incorporated (NASDAQ:MSTR), a firm whose aggressive Bitcoin (CRYPTO: BTC) acquisition strategy has sparked significant interest lately.
What Happened: On Wednesday, Woo took to X to state that the primary risk lies in the company’s convertible debt offerings.
He said that if the buyers of the convertible debt do not convert to shares before maturity, MicroStrategy would be forced to sell Bitcoin to repay the debt holders.
Woo argued that this scenario would occur if MicroStrategy’s stock didn’t increase by roughly 40% within the next 5-7 years.
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