Peter Schiff Says Strategy Loses Bitcoin Funding Route Through STRC
Schiff points out that STRC has recovered, but that does not yet make it easy for Strategy to raise new capital for Bitcoin. The company is now leaning more on stock sales and cash while it keeps growing its BTC stash.
Key Takeaways
- Peter Schiff says Strategy has lost its main funding route through STRC, despite the rebound toward $100.
- Strategy last sold STRC in May and funded later Bitcoin purchases through other sources, including Class A shares and cash.
- The company keeps actively adjusting its capital structure and now holds about 845,050 BTC.
Peter Schiff says Strategy has lost its main route for funding Bitcoin, even though the company itself keeps buying more BTC. According to the well-known Bitcoin critic, the price of Stretch preferred stock (STRC) has recovered toward $100 (€89), but that does not yet mean Strategy can easily raise new capital through that instrument again.
STRC Recovers, But The Route Stalls
Schiff said on his podcast on October 2 that STRC is trading around $99.4 (€89) and that the rebound surprised him. He attributed the rise to Strategy’s weekly buying and Bitcoin’s recent rally. In his view, that Bitcoin rally may also have helped because investors regained some confidence or because short positions had to be covered.
The preferred stock had fallen to around $75 (€67) earlier this year. CEO Phong Le explained that at the time as the result of unexpected leverage. Schiff flipped that logic around and said the recovered price does not automatically restart the funding machine.
He also said Strategy probably cannot just sell more Stretch again to raise extra money for new Bitcoin purchases. He added that the company still has enough cash to keep paying the STRC dividend distributions for a while longer.
Bitcoin Keeps Coming In Through MSTR
The numbers from the recent filings show that Strategy has been using other sources in the meantime. The company last sold STRC through its at-the-market program between May 11 and May 17, bringing in about $1.95 billion (€1.7 billion). Since then, the remaining capacity in the filings has stayed at about $17.51 billion (€15.6 billion), which suggests no new STRC shares have been issued.
Strategy then paused Bitcoin buying for ten weeks over the summer and instead sold coins during that period to pay dividends and STRC buybacks. When it started buying again at the end of August, the money came from other sources. The company funded 4,603 BTC with sales of Class A shares and later another 1,665 BTC. In between, it also bought 950 BTC with $75.7 million (€67.4 million) from the USD Cash account.
In September, Strategy also bought back more than 1.4 million STRC shares for $139.3 million (€124 million). That fits the picture of a company that keeps actively managing its capital structure while also expanding its Bitcoin position. Strategy is now the world’s largest corporate Bitcoin holder and owns according to recent figures about 845,050 BTC.
What This Means For Investors
For European crypto followers, this is especially relevant because Strategy has for years been one of the clearest examples of a public company that keeps funding Bitcoin through the capital markets. If the STRC route becomes less useful, attention shifts to common stock sales and other funding sources. That makes Strategy’s next update especially important, especially since the company usually announces its purchases on Monday.
The broader market is also watching the funding mix of large Bitcoin treasuries. In a recent analysis of crypto treasury stocks, it was already clear that many of those companies trade below the value of their holdings, which can make raising capital harder.
