The leveraged Bitcoin approach to the strategy came under renewed scrutiny on Sunday as critics questioned whether Michael Saylor’s company could withstand prolonged market stress.
Among the most vocal was longtime Bitcoin critic Peter Schiff, who chairs Schiff Gold and is chief global strategist at Euro Pacific Asset Management.
In a series of articles on
He also said he believed the company would “eventually go bankrupt” and challenged Saylor to debate him at Binance Blockchain Week in Dubai in early December. His invitations seemed designed, at least in part, to draw Saylor into a public confrontation over the company’s approach to holding Bitcoin.
Jeff Dorman, chief investment officer of digital asset management firm Arca, offered a markedly different perspective. In his own article on Dorman did not directly reference Schiff, but his comments addressed broader claims circulating among skeptics who say the strategy could face significant pressure if Bitcoin prices fall sharply.
Dorman said Saylor’s 42% stake made an activist takeover “nearly impossible” and noted that none of Strategy’s debt included clauses that would force the company to liquidate Bitcoin. He added that the company’s existing software business was still generating positive cash flow, helping to support interest expenses which he described as manageable. It’s also rare for borrowers to default just because a deadline is approaching, he added, arguing that lenders often agree to extend terms in what he calls a familiar “extend and pretend” dynamic.
Strategy stock has been under pressure despite its growing position in Bitcoin. Class A shares closed at $199.74 on Friday, down 4.22% on the day and 33.42% year to date. During the same period, bitcoin returned around 0.4%.
According to StrategyTracker, which tracks companies’ Bitcoin treasuries, Strategy’s diluted market NAV multiple stands at nearly 1.06x, meaning the shares are trading only slightly above a conservative estimate of their Bitcoin-backed value after accounting for all potential future action from options, warrants and convertible debt.
Dorman added that Strategy is no longer a significant marginal buyer of Bitcoin relative to ETF inflows, but said that does not make the company a systemic risk. “If you follow anyone who says MSTR poses a risk to BTC, tell them to call me,” he wrote.
Bitcoin was trading around $94,293 as of 11 p.m. UTC, down 1.2% over the past 24 hours.
