Peter Schiff Says Strategy’s STRC is a Ponzi Scheme: Here’s Why

Bitcoin critic Peter Schiff held a stay audio Space on X earlier right this moment, the place he referred to as Strategy’s most popular inventory providing, STRC, “an apparent Ponzi scheme” and invited Michael Saylor and others to show him mistaken.

The house ran for roughly two hours, with Schiff utilizing most of that point to stroll by way of why he thinks the product will finally go away retail buyers with nothing.

Why Schiff Says the Math Doesn’t Work

Schiff opened the Space with a textbook definition:

“A Ponzi, by definition, is when revenue paid out to current buyers comes from bringing in new buyers, and then you definitely take the cash from the the brand new buyers and use it to make funds to the outdated buyers,” he stated.

He additionally claimed that Strategy has no significant revenue. Yes, its software program enterprise generates some income, nevertheless it is nowhere close to sufficient to cowl the dividend obligations on STRC, which pays holders 11.5% yearly in month-to-month money distributions.

As such, STRC suits that template immediately as a result of Strategy raises cash by issuing new shares of the popular inventory, makes use of these proceeds to pay dividends to current STRC holders, after which should difficulty nonetheless extra shares to pay the subsequent spherical of holders.

“How does STRC make funds when the corporate itself doesn’t have any revenue?” Schiff requested. “The 11.5% yield on STRC is paid by promoting extra shares of STRC, and then you definitely get cash from the brand new buyers to pay the outdated buyers.”

Strategy has been shopping for Bitcoin aggressively. Last week, it spent $2.54 billion acquiring 34,164 BTC at a mean worth of $74,395, to convey its complete holdings to 815,061 BTC, purchased for roughly $61.56 billion at a mean worth of $75,527.

STRC has been the funding engine for such purchases, with the popular inventory hitting a new single-day buying and selling quantity report on April 13, when it introduced in $1.1 billion, an quantity 46.5% above its earlier report and greater than 4 instances its 300-day common of round $274 million.

Shares Could Go to Zero

Schiff identified that Strategy has no authorized obligation to maintain paying dividends on STRC since that is discretionary. Holders can not power reimbursement and can’t redeem their shares; they’ll solely promote them. So, if Saylor stops paying, the yields disappear, demand collapses, and the shares go to zero.

“It is an IOU for nothing,” claimed the gold bug.

The yield itself, he argued, tells the story. It began at 9% when STRC launched in July 2025 and has been raised a number of instances since, sitting at 11.5% since April. According to Schiff, the demand for STRC retains softening, so the charges preserve climbing to tug in new consumers.

“They preserve jacking it up as the availability of suckers dries up.”

One listener on the Space pushed again, saying Strategy was solvent, with the present worth of its BTC holdings approach greater than the corporate’s market cap, which means it may promote the Bitcoin and comfortably repay all shareholders. But Schiff was having none of that, saying that the occasion Strategy tried promoting its BTC, costs would plummet.

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