Microstrategy: Anatomy of a Scam

When will the pyramid scheme unfold?

Goodmorning all. As our readers know, we aim to only report when it matters and we believe this will be an important report as we uncover the potential concerns around Microstrategy. For more such groundbreaking material, upgrade as a paid member.

Introduction

In the corridors of MicroStrategy's Virginia headquarters, software engineering has taken a back seat to financial engineering. The enterprise software company, once known for its business intelligence tools, has transformed itself into what industry observers call a "leveraged Bitcoin fund with a software subsidiary."

"We're looking at a novel form of regulatory arbitrage," says a former SEC enforcement director who requested anonymity due to ongoing matters. "The company appears to be operating as an unregistered investment company while using its software business as regulatory cover."

Michael Saylor, the company's founder and executive chairman, has overseen this transformation through a series of debt offerings and Bitcoin purc…