Renowned economist Peter Schiff has once again criticized the debt-fueled Bitcoin acquisition strategy of Michael Saylor’s Strategy Inc. despite the company’s decreasing share price. Schiff argued that Strategy Inc.’s decision to go on a buying spree of Bitcoin has led to shareholder dilution, reducing the premium on the firm’s BTC holdings.
In a recent post, Schiff highlighted that Strategy Inc.’s stock has underperformed despite leveraging on Bitcoin buying. He pointed out that the company’s share price and Net Asset Value (NAV) premium have decreased, causing the premium to its crypto holdings to collapse by 85%.
Schiff’s criticism of Strategy Inc.’s Bitcoin investment strategy stems from the company’s reliance on debt to finance its BTC acquisitions. He expressed concerns about the potential risks associated with too much debt, especially if the price of Bitcoin were to drop.
Despite the skepticism from Schiff and other critics, Strategy Inc. remains undeterred in its BTC acquisition master plan. The company recently announced the purchase of 20,356 Bitcoins worth around $1.99 billion, increasing its total BTC holdings to 478,740 coins with a total value of $44 billion.
While some Bitcoin enthusiasts may disagree with Schiff’s assessment of the premium collapse, the economist remains steadfast in his belief that the debt-fueled strategy could spell trouble for Strategy Inc. in the event of a significant BTC price decline.
As the debate over Strategy Inc.’s Bitcoin acquisition strategy continues, it remains to be seen how the company will navigate the challenges posed by its debt-driven approach. With the cryptocurrency market constantly evolving, the future of Strategy Inc.’s BTC holdings and its impact on shareholder value remain uncertain.