Bitcoin Is A 'Beautiful House In A Scary Neighborhood' — MicroStrategy Is A 'Beautiful House With 10,000 Acres Of Ranch Land Behind It'

MicroStrategy Inc MSTR picked up another 12,800 Bitcoin BTC/USD in the second quarter for $361.4 million. Executive chairman Michael Saylor explained why buying shares of MicroStrategy is the best way to get exposure to what he calls "the apex property of the human race."

What To Know: Following MicroStrategy's quarterly results, Saylor highlighted the advantages of buying MSTR shares over Bitcoin or even a Bitcoin ETF.

"The operating company provides diversification for investors versus the volatility of Bitcoin and it also allows us to borrow money very cheaply," Saylor said Wednesday on CNBC's "Squawk On The Street."

MicroStrategy is a business intelligence, mobile software, and cloud-based services company, but more than anything else, it's a bet on Bitcoin. The company's total Bitcoin holdings have now climbed to 152,800 at an average cost of approximately $29,672.

Related Link: MicroStrategy Q2 Earnings Highlights: Revenue Miss, EPS Beat, Updates On Bitcoin Holdings, Average Cost Per BTC

The volatility in shares of MicroStrategy due to its Bitcoin positions allows the company to borrow and raise capital at low cost in order to turn around and buy more Bitcoin and grow its business, Saylor said. 

Bitcoin has rallied in recent months, largely driven by improved odds of a Bitcoin ETF getting approved. Some believe a Bitcoin ETF could hurt the MicroStrategy investor base, but Saylor doesn't see it that way.

"Bitcoin, you can think of as this beautiful house in a scary neighborhood that you have to pay for in cash, takes a year to buy and you can never rent it. The Spot ETF is like that same beautiful house in a nice neighborhood and you can buy it tomorrow, no money down... it's not a threat to MicroStrategy," he said.

"Microstrategy is like that beautiful house with 10,000 acres of ranch land behind it that generates cash flow that has a management team that can borrow money at 1%, 2% interest in order to develop the land."

See Also: Jack Dorsey Extends Hand To Coinbase: 'Happy To Partner' For More Focus On Bitcoin Lightning Network

MSTR Price Action: MicroStrategy shares were down 2.72% at $396.27 at the time of publication, according to Benzinga Pro.

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