Peter Schiff, a well-known skeptic of the first cryptocurrency, once again predicted an imminent collapse for Strategy (MSTR) shares. However, the market seems not to share his pessimism: the company's stock surged to $137.4 amid a confident recovery in bitcoin, which broke through the $80,000 mark this week. Michael Saylor, Strategy's steadfast leader, responded to the critic with a short but expressive AI-generated video in which he rides a bull somewhere in Spain.
Schiff insists on a bearish scenario
Since the beginning of August, Strategy's shares have been rising almost in tandem with bitcoin, which would seem to confirm the soundness of the chosen strategy. But Schiff sees this not as fundamental demand, but merely as a temporary effect from the forced covering of short positions. In his logic, traders were massively buying shares to close out shorts, and it is this that artificially inflated the price, not investor belief in the company's long-term potential.
This is not Schiff's first warning. For several months now, he has been insisting that dividend obligations on preferred shares make Strategy extremely vulnerable to any significant drop in BTC. He has repeatedly called MSTR a "scam" and predicted a "death spiral," pointing out that payouts are funded by issuing new shares, and the dividends themselves are "floating" and depend on market volatility.
Saylor responds with irony
Michael Saylor did not remain in debt. On his X social media account, he published a neural network-generated video in which he confidently sits atop a bull. This is a direct response to all the bearish forecasts — a clear demonstration of his unwavering faith in bitcoin's growth and, consequently, in the success of his own company. Earlier, experts had already linked the surge in Strategy's shares to a decline in panic sentiment and the fading of talk about a possible forced sale of BTC to cover obligations.
The polarizing views of Schiff and Saylor reflect a fundamental divide in assessing Strategy's business model. Schiff points to real balance-sheet risks that he has been talking about for over a year. Saylor, relying on bitcoin's upward trend, displays ostentatious confidence. The question is simply who will turn out to be right: will Schiff's warning prove true, or will Saylor's strategy continue to bear fruit.
My take: The current rise in MSTR is a classic example of how a strong trend in the underlying asset's market can temporarily offset structural risks. However, investors should remember: as long as the price of BTC moves upward, Strategy's model works flawlessly, but when the trend reverses, it is precisely such companies with high debt burdens and dividend obligations that are the first to take a hit. Keep an eye on BTC's support level — it will serve as an indicator for MSTR shares as well.