Economist Peter Schiff warned on July 16 that Strategy Inc. (Nasdaq: MSTR) is no longer a leveraged bitcoin bet and that continued share issuance threatens to dilute common shareholders' bitcoin exposure. Schiff's critique centers on Strategy's capital structure: the company holds 843,775 BTC valued at approximately $54.13 billion, but also carries $6.75 billion in debt and $15.46 billion in preferred securities. The warning comes as Strategy reported a quarterly BTC yield of negative 1.6%, though its year-to-date BTC yield remained positive at 6.6%. The debate focuses on whether future share issuance will continue growing bitcoin per share or lead to further dilution that benefits creditors and preferred investors over common shareholders. Strategy's financing model increasingly directs capital toward senior obligations, including a perpetual preferred stock (STRC) that pays a variable annual dividend currently set at 12%.
Strategy Holds 843,775 BTC Alongside $6.75 Billion Debt and $15.46 Billion Preferred Securities
Strategy's live dashboard showed the company held 843,775 BTC valued at about $54.13 billion, representing 207,776 satoshis per share. The company also reported $6.75 billion in debt and $15.46 billion in preferred securities. In his July 16 post on X, Schiff stated MSTR is "no longer a leveraged bitcoin bet" and warned that continued share sales would dilute bitcoin ownership per common share while benefiting creditors and preferred investors.
Quarterly BTC Yield Reports Negative 1.6% While Year-to-Date Yield Remains Positive 6.6%
Strategy reported a quarterly BTC yield of negative 1.6%, indicating bitcoin exposure per share weakened during the period. However, the company's year-to-date BTC yield remained positive at 6.6%. The split in these metrics leaves the debate unresolved regarding whether bitcoin per share continues to rise or faces dilution pressure.
Perpetual Preferred Stock STRC Pays 12% Annual Dividend
Strategy reported $15.46 billion in preferred securities, including STRC, its perpetual preferred stock that pays a variable annual dividend currently set at 12%. Strategy may use its dollar reserve to meet interest and preferred dividend obligations, then replenish that reserve through capital-market activity or bitcoin sales. The company's second-quarter earnings release is scheduled for July 30. Updated share counts, bitcoin per share, and financing activity will be disclosed in that report.
FAQ
What did Peter Schiff say about Strategy Inc. on July 16?
Peter Schiff warned on July 16 that Strategy Inc. (MSTR) is no longer a leveraged bitcoin bet and that continued share sales would dilute bitcoin ownership per common share while benefiting creditors and preferred investors.
What is Strategy's current capital structure?
Strategy holds 843,775 BTC valued at approximately $54.13 billion (207,776 satoshis per share), alongside $6.75 billion in debt and $15.46 billion in preferred securities. The company reported a quarterly BTC yield of negative 1.6% and a year-to-date BTC yield of positive 6.6%.
When will Strategy release its second-quarter earnings?
Strategy's second-quarter earnings release is scheduled for July 30. The report will include updated share counts, bitcoin per share, and financing activity.
