Peter Schiff Says Strategy's Common Stock Will Eventually Be Worthless As Michael Saylor Says STRC Is The Biggest Position In Three Major ETFs

Schiff also reiterated his bearish Bitcoin outlook, warning a break below $50,000 could trigger a deeper decline toward the $20,000-$30,000 range.

• Peter Schiff renewed his attack on Strategy and Michael Saylor, arguing the firm's Bitcoin-driven capital structure promoted “excessive speculation”
• According to Schiff, this could ultimately leave Strategy’s common shareholders with nothing.
• Saylor highlighted growing institutional adoption of Strategy's preferred stock STRC, which has become a top holding in several major preferred-stock ETFs.

Strategy (MSTR) is being torn in two ways at once—Peter Schiff said the company’s common equity is headed to zero. Meanwhile, Michael Saylor pointed to a milestone that says otherwise. 

Schiff, a long-time gold bull and one of Bitcoin’s (BTC) most persistent critics, on Thursday accused Saylor of promoting “excess speculation” and predicted Strategy’s common equity will “eventually” be worthless. Schiff said, “Eventually the common stock equity will be worthless for Strategy”

Additionally, he said, “I don’t think this bear cycle is over.” Speaking on Anthony Pompliano’s podcast, he explained that “A breakdown below $50,000 could trigger the next major leg down, with broader downside targets extending all the way to $20,000-$30,000 if key support fails.” 

Bitcoin’s price continues to trade at the $ 63,000 level, down over 2% during the past 24 hours. On Stocktwits, the retail sentiment around BTC shifted to ‘neutral’ from the ‘bullish’ zone, while chatter around it remained at ‘low’ levels over the past day.

Saylor Touts STRC's ETF Reach

Schiff’s critique came the same week Saylor was pushing a different story. Strategy's variable-rate perpetual preferred stock (STRC) was now the biggest holding in three major US preferred stock exchange-traded funds (ETFs), Saylor said on Friday. 

Those included BlackRock’s iShares Preferred and Income Securities ETF (PFF), Virtus InfraCap’s US Preferred Stock ETF (PFFA) and VanEck’s Preferred Securities ex Financials ETF (PFXF), which together held $756 million across the three ETFs. Saylor wrote that “Digital Credit is going into the institutional mainstream,” calling the placements validation for Strategy’s Bitcoin-backed capital products.

But that embrace of the institution comes with a limitation. STRC’s price closed near $86 on Friday, still more than 13% below the $100 par value it’s designed to track, even as institutional demand grows. Retail investor sentiment for STRC on Stocktwits is still in the ‘bearish’ range, and the level of sentiment is ‘extremely low’ over the last day.

Retail ownership of the security also dropped from 78% in March to 71% by July, according to data from Strategy CEO Phong Le, with average institutional allocation up 105% to roughly $3.5 million per position over the same period.

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