Strategy’s New Bitcoin Playbook Is Winning Over Wall Street – But Critics Brand Michael Saylor 'The Biggest Seller'

On The Wolf of All Streets, critic Peter Schiff said Saylor "basically just surrendered," moving from the biggest buyer to the biggest seller.

• Strategy rose over 12% on Monday after revealing that it bought no Bitcoin between June 22 and 28.
• Under its new Digital Credit Capital Framework, the firm raised its STRC dividend to 12% and authorized a $1 billion buyback in common stock and digital credit securities. 
• Citi maintained a 'Buy' with a $260 target, while Benchmark-StoneX's Mr. Palmer called the structure "robust."

Shares of Strategy (MSTR) fell nearly 3% in early trade on Tuesday after surging over 12% in the previous session, as investors weighed the Bitcoin (BTC) treasury company’s sweeping capital overhaul against concerns that it could mark a shift in Executive Chairman Michael Saylor’s long-standing “never sell” Bitcoin philosophy.

Strategy disclosed it did not buy any bitcoin between June 22 and June 28: a pause that drew "Buy" reiterations from both Citi and Benchmark-StoneX even as critics branded the pivot a “surrender.”

MSTR’s price was down over 3% in pre-market trade. On Stocktwits, it was one of the top trending tickers on Stocktwits. Retail sentiment around MSTR remained in the ‘bullish’ zone over the past day, while chatter improved to ‘extremely high’ from ‘high’ levels.

Why MSTR Rallied On Monday

The bounce on Monday followed a capital overhaul the company called its Digital Credit Capital Framework. Strategy increased the dividend rate on its variable-rate Series A perpetual Stretch preferred stock (STRC) to 12%, authorized up to $1 billion in buybacks for its common stock and digital credit securities, and increased its USD reserve to approximately $2.55 billion. 

Executive Chairman Michael Saylor said the firm would be selective about issuing new MSTR shares. Strategy’s new model has pushed its mNAV above 1 as of writing. 

Strategy also approved a BTC monetization program to facilitate sales for three reasons: to fund the USD reserve, to pay preferred dividends and interest, and to fund buybacks. Any sale beyond these uses must be otherwise authorized by the board, the company said. This program authorizes Bitcoin sales under defined conditions, but does not require the company to reduce its Bitcoin holdings.

Strategy’s holdings were unchanged over the period, and the company has not sold down its stack beyond a token 32-BTC sale revealed earlier in June. 

Wall Street Sees Lower Financing Risk

On Tuesday, Citi maintained a ‘Buy’ rating on Strategy with a price target of $260. The plan buys Strategy more time for Bitcoin to potentially stabilize and lessens the risk to its issuer rating, a Citi analyst said in a research note to clients.

Benchmark analyst Mark Palmer kept a ‘Buy’ rating and $570 price target on MSTR, calling the STRC decline a market-driven reset rather than a structural collapse, according to Decrypt.

Critics Say Saylor Will Be A Net Seller Now

However, not all maintained a bullish outlook on the software firm. Strategy’s biggest critic, Peter Schiff, said on the Wolf of All Streets podcast that Saylor "basically just surrendered," arguing the company had gone "from the biggest buyer to the biggest seller." Saylor would have to sell Bitcoin to pay preferred dividends, build reserves, and service debt, Schiff said. 

“Wall Street didn't like crypto until they realized they can make money off of it. Once they started making money, they loved it. They're making a ton of fees on the ETFs. But you know who they made the most money from? Saylor and Strategy. All these ATM sales of Strategy stock, all the issuing of these securities, Wall Street got so much in banking fees," 
- Peter Schiff, CEO and Chief Global Strategist of Euro Pacific Capital

MSTR: Retail Traders Remain Divided

Retail traders on Stocktwits picked up on the disconnect between Saylor’s “never sell” brand and the new monetization program. 

One user said the $1.25 billion sales authorization as the headline, stating that the man who built his whole identity on ‘never selling’ is now selling. 

View this Stocktwits post

Another user was even more gloomy on the firm's structure, stating, “Saylor has big problems coming. I'm not totally bearish - I will be bullish once his shell company gets liquidated.”

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