CEO Brad Garlinghouse addressed XRP's cross-border payments use case, saying Ripple processed $16 trillion last year, but nearly none of it using digital assets.
- Ripple CEO Brad Garlinghouse said the leveraged model of Strategy has damaged the wider crypto market, but added he remains bullish on Bitcoin.
- He flagged Strategy's Stretch preferred stock (STRC), trading about 25% below its $100 par value, as a "damning indictment" of the strategy.
- Long-term value comes from utility, not financial engineering, Garlinghouse said, and said, "Team Michael Saylor wasn't focused on the right stuff."
Ripple (XRP) CEO Brad Garlinghouse criticized Michael Saylor's Strategy (MSTR) on Friday, saying the company's funding approach had hurt the broader crypto market even as he remained bullish on Bitcoin (BTC).
Garlinghouse framed the issue in a Friday CNBC interview as a clash between utility and financial structuring, arguing that Strategy’s approach had pulled attention away from what should matter in crypto.
The Problem With Strategy’s Financial Engineering Model
“Team Michael Saylor wasn’t focused on the right stuff, and that has hurt the overall market,” Garlinghouse said. However, he expressed his bullish view on Bitcoin, separating the asset from Strategy’s preferred-share financing model.
Financial engineering does not drive long-term value," he said, adding that "the long-term value of any digital asset is going to be driven by utility."
When asked what the goal should be as Saylor tries to protect the company’s preferred shares, common equity, and currency, Garlinghouse stated the focus should be on long-term value rather than capital structure. "If you're just trying to financial engineer and leverage and borrow more money to buy more bitcoin," that method will not produce sustainable value.
The criticism centered on Strategy’s Variable Rate Series A Perpetual Stretch Preferred Stock (STRC), a preferred security used in the company’s Bitcoin-buying capital structure. Garlinghouse pointed to STRC trading roughly 25% below its $100 par value and called the slide a “damning indictment” of Strategy’s approach.
Garlinghouse attributed Strategy's troubles to leverage, saying that while Saylor would describe the approach differently, the effect was the same. He said the structure added excitement on the way up but had begun to compound negatively as crypto moved through its cycles, a dynamic he said many asset classes experience.
This comes as MSTR faces heat over its leverage-heavy capital structure, with its Stretch preferred (STRC) trading well below par and its common stock near 52-week lows.
Garlinghouse Frames Bear Market As Opportunity To Be ‘Greedy’
Despite the criticism, Garlinghouse reiterated a constructive view on bitcoin, invoking Warren Buffett's maxim to be fearful when others are greedy and greedy when others are fearful. "Now is the time, I think, to be greedy," he said.
He characterized bitcoin's role as “digital gold”, contrasting its portability with physical bullion. Garlinghouse said moving $300 billion of gold, as Germany's central bank had done, took two years and billions of dollars, while an equivalent sum in Bitcoin could be moved quickly.
Turning to Ripple's own focus, Garlinghouse said the utility of its associated digital asset, XRP, lies in cross-border payments and the speed of its underlying blockchain for institutions.
He said Ripple cleared roughly $16 trillion in payments last year, partly through acquisitions, but that the share routed through a digital asset was close to zero — a gap he framed as the company's opportunity to bring traditional finance onto blockchain infrastructure.
XRP’s price was trading over $1, up over 4% in the last 24 hours. On Stocktwits, retail sentiment around XRP remained in the ’bearish’ zone, while chatter stayed at ‘normal levels over the past day.
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