Peter Schiff, who has spent years warning anyone who'll listen about Bitcoin's inevitable demise, found a new target on Monday: Michael Saylor's debt-funded cryptocurrency strategy. According to Schiff, Strategy (MSTR) would have been better off buying pretty much any other asset instead of Bitcoin.
The criticism centers on a straightforward math problem. Strategy's average Bitcoin (BTC) cost sits near $75,000, which means the company's massive holdings are up less than 15% in unrealized gains. That's not exactly the kind of return that justifies years of aggressive accumulation and leveraged bets on a volatile asset.
A Bitcoin Balance Sheet Under Pressure
Schiff's critique came as Bitcoin continues trading in a fairly narrow range through December, which creates headaches for companies whose stock prices move in lockstep with crypto valuations. Strategy's shares have dropped about 63% from their July high, reflecting both Bitcoin's pullback and growing investor anxiety about the company's leverage.
The timing isn't great. Bitcoin has been stuck mostly between $85,000 and $95,000 this month, sitting roughly 30% below its October peak. For a company that's built its entire identity around accumulating Bitcoin, that kind of sideways action doesn't help the narrative.
According to Strategy's latest SEC filing, the company now holds 671,268 Bitcoin purchased at an average price of $74,972. They added another $980 million worth yesterday at prices near $92,000 per coin, continuing the aggressive buying strategy that's defined the company's approach.
Management Stands Firm on the Long Game
Despite the criticism from Schiff and others, Strategy's leadership isn't backing down. CEO Phong Le told Fox Business that Bitcoin represents a unique asset class and predicted demand would strengthen in 2026, driven by bank adoption and increased participation from nation-states.
Le's argument is that Strategy isn't just betting on Bitcoin matching the market. The company's leveraged exposure means it should outperform Bitcoin itself over time, assuming the thesis plays out. That's the theory, anyway.
To manage downside risk, Strategy recently built a $1.4 billion cash reserve funded through stock sales. Management says this buffer can cover dividend and interest obligations for nearly two years, reducing the chance they'd be forced to sell Bitcoin during a brutal market downturn.
Trading Below Bitcoin Holdings Value
Here's where things get interesting. Strategy's market capitalization has actually fallen below the value of its Bitcoin holdings. That's not unique to Strategy—several digital asset treasury companies face the same situation—but it highlights how nervous investors have become about the leveraged Bitcoin playbook.
The discount suggests the market is pricing in significant execution risk, leverage concerns, or both. When a company's stock trades below the value of the assets it holds, investors are essentially saying they'd rather own those assets directly than deal with the company's structure and strategy.
Volatility Hammers the Market
The broader crypto market isn't helping matters. Bitcoin dropped below $86,000 on Tuesday, triggering approximately $582 million in liquidations of leveraged long positions, according to data from Coinglass. U.S. spot Bitcoin ETFs saw heavy selling too, with about $358 million in net outflows on Monday, per DefiLlama.
Transform Ventures CEO Michael Terpin captured the mood, describing a market facing a shortage of buyers alongside growing nervousness among sellers. That's not exactly the kind of sentiment that leads to quick recoveries.
Technical Outlook for Strategy Stock
MSTR suffered a sharp selloff on Monday, closing over 8% lower after losing trend support. The stock is trading well below all major moving averages, confirming a strong bearish trend. Every recent bounce has failed near the upper channel line, meaning rallies are being sold quickly.
Tuesday's 2% pre-market bounce looks like a technical relief move rather than a trend reversal. As long as the price stays below $180–$190, downside risk remains substantial. If selling resumes, the next support zone sits near $150–$145.
A real trend shift would require a daily close back above the falling channel and reclaiming the $200+ level. Until that happens, the path of least resistance appears to be lower.
Bitcoin's Technical Picture
Bitcoin bounced again from the $84,000–$85,000 zone, which is acting as short-term support. Even with recent green candles, Bitcoin remains below key resistance levels, meaning the broader trend is still weak.
As long as Bitcoin stays below $96,000, sellers still control the structure. If support near $85,000 breaks, downside risk opens toward $80,000. A bullish shift would need a clean move back above $96,000 with follow-through, something the market hasn't been able to deliver lately.
The question for both Strategy and Bitcoin is whether this is just another consolidation phase before the next leg higher, or something more concerning. Schiff clearly thinks he knows the answer. Strategy's management believes otherwise. Investors are voting with their feet, and right now, they're heading for the exits.
