‘Beginning of the End’: U.S. Economist Questions Viability of Strategy

TL;DR

• Economist Peter Schiff calls the financial model of Strategy (MSTR) “fraudulent” and “unsustainable.”
• MSTR stock has fallen 35% in the last month, closing Monday’s trading session at $171.42.
• The Strategy CEO indicated that the company might sell part of its Bitcoin reserves if the stock price drops further.

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The financial structure of Strategy is reportedly beginning to unravel. That is the argument made by US economist Peter Schiff when warning about the future of the company. Last Monday, the company’s stock closed at $171.42, dropping more than 3% and accumulating a 35% slump over the past month.

So $MSTR's new business model is to sell stock to raise cash, then use that cash to buy Treasuries that yield about 4% to fund the issuance of debt and preferred stock at a cost of 8%–10%. How much longer will investors pretend this is a viable business just to gamble on Bitcoin?

— Peter Schiff (@PeterSchiff) December 1, 2025

The economist asserts that Strategy is entering the early stages of an imminent collapse. In a message posted on X on Monday, he indicated that Michael Saylor, the architect of the Bitcoin accumulation strategy, is now forced to sell stock not to acquire more BTC, but simply to raise dollars to cover the company’s costly interest and dividend obligations.

He further labeled the business model as a “fraud” and an “unsustainable” structure, questioning how long investors will continue to support a model built on increasing liabilities and shareholder dilution.

Debt Strategy vs. ‘Never Sell’ Philosophy

The pressure on Strategy intensified following the recent reversal of its core stance. CEO Phong Le indicated that the company might be forced to sell part of its Bitcoin reserves if the stock price falls below its market-implied net asset value or if it can no longer obtain capital through normal channels.

This comment marks a significant break from the commitment to never sell its Bitcoin reserves, a philosophy that was fundamental to the company’s identity and valuation, increasing fears about a potential collapse of Strategy.

Financial concerns are deepening. Strategy built a $1.44 billion cash reserve to guarantee future dividend and obligation payments, a move interpreted by many as preparation for a tougher environment.

At the same time, the stock value is amplified by the company’s leverage and weakness in the crypto market, with Bitcoin trading below $90,000. Strategy’s market capitalization has now fallen to about $45 billion, a value lower than its own Bitcoin reserves.

In summary, the tension in the stock price and the shift in the philosophy regarding the sale of BTC are key indicators that, for Schiff, confirm the long-term inviability of Strategy’s imminent collapse.