The Risks of Shorting MSTR and Long Bitcoin

During their recent episode, Taylor, Carlisle, and Jason Buck discussed The Risks of Shorting MSTR and Long Bitcoin. Here’s an excerpt from the episode:

Jason: Well, the other thing we were talking about before, that I would caution everybody on and that’s what I’ve seen too much of on Twitter, X is like people saying this is a no brainer ARB. I’ll just short MSTR and be long bitcoin. They think that is just the delta of like it being leveraged bitcoin. But the things I talked about with the convert ARB and if they get CDS that they get inclusion, that can go from 3x to 4x to 10x to 12x immediately and you get your–

Jake: NAV of–

Jason: And you just get killed.

Jake: -of bitcoin basically.

Jason: Yeah. And so, that’s a really tough trade that I’ve been trying to caution people out of. But I don’t like to caution people on any trades, because what if it works, then I’m the idiot that talked them out of it. So, that would just be the caution, is like that multiple of bitcoin NAV can dramatically increase. Like to your point, Toby, it could also come back. It could also collapse back in. I don’t know the future, so I’m not predicting any of that.

Tobias: If it works, you recommend it. If it didn’t work, you didn’t recommend it.

Jason: Exactly.

Jake: 40% chance.

Jason: Yeah.

Tobias: 40% chance.

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