Питер Шифф уличает бизнес-модель Strategy в мошенничестве, пока mNAV компании стремительно падает Translation: Peter Schiff exposes Strategys business model as fraudulent as the companys mNAV plummets.

mNAV of the company has dropped below 1 for the first time since the beginning of 2024.

Peter Schiff, a prominent cryptocurrency critic and gold advocate, claimed that the financial framework of the largest publicly traded Bitcoin holder, Strategy, is based on «deception.»

*“The business model of MSTR completely relies on funds purchasing its ‘high-yield’ preferred shares. However, the promised yields will never be paid out. Once the managers realize this, they will divest from these securities,”* he stated.

According to Schiff, this will trigger a «death spiral,» as the company will lose its ability to secure funding through debt instruments.

When asked why Strategy might not pay dividends, the expert replied:

*“Dividends are paid solely at the discretion of the MSTR board of directors. The company has no obligations to declare them and faces no penalties for not paying. Accumulation of unpaid dividends does not occur — the possibility of receiving them is irretrievably lost.”*

Users disagreed with him, accusing him of spreading FUD.

In a separate post, Schiff invited the founder of Strategy, Michael Saylor, to debate during Blockchain Week in Dubai in December. Saylor has yet to respond to the invitation — instead, Mert Mumtaz, CEO of Helius Labs, put himself forward:

*“It seems abundantly clear. I would be happy to debate you on any crypto-related topic. The stakes are at least $10 million in ZEC for the loser.”*

A user named Cryptoguy pointed out that Strategy does not rely on preferred shares for survival — the company issues them solely to purchase Bitcoin, not to fund its operations.

*“Even if the issuance slows down, there won’t be a collapse — they will simply use less leverage. Calling it a ‘death spiral’ is a significant exaggeration,”* he emphasized.

The cryptocurrency opponent replied that if the company loses its ability to generate returns from digital gold, it will forfeit a key source of its market value. Cryptoguy countered that Strategy’s value lies in providing institutional access to Bitcoin using leverage and high liquidity.

Crypto enthusiast Shagun Makin noted that in every cycle, “someone declares MSTR to be a ticking time bomb.” However, according to him, the company’s strategy has thus far successfully withstood various challenges.

Some agreed with Schiff, including Scott McClintock, a Bitcoin and Zcash supporter and founder of the betting project The Home of FAIR PLAY.

*“I believe in BTC and ZEC, but Saylor’s strategy does not hold up to scrutiny. You cannot call the scheme of ‘bringing in capital, buying Bitcoin, growing with it, and locking in profits’ arbitrage. It’s a financial pyramid that sustains itself. Liquidity providers are setting themselves up for failure. The model is unsustainable,”* he asserted.

Schiff’s remarks came amid the ongoing correction of Bitcoin and Strategy’s mNAV falling below 1 for the first time since the beginning of the crypto treasury boom. At the time of writing, the indicator had recovered to 1.21.

This decline indicates that the market value of the firm is less than the Bitcoin it owns, minus its liabilities. This reflects a high proportion of leveraged financing.

Such a situation last occurred in early 2024.

Investors believe that a stable mNAV level for a treasury company is 2 or above. Since July, Strategy’s stocks have declined by more than 50%, and they are currently trading at around $199.

Strategy holds 641,205 BTC with a value exceeding $61 billion, according to BitBo.

Bitcoin is trading around $95,300. According to CoinGecko, in the last 24 hours, its price has dropped by 0.4%, and over the week — by 10.2%. Analysts explained the cryptocurrency’s decline as a result of panic among new investors.

Recall that at the beginning of November, Kynikos Associates closed its short position against Strategy stocks. Its founder, James Chanos, attributed this to the drop in the company’s mNAV.