Peter Schiff Questions Strategy’s 12% Yield as Bitcoin Drops 19% This Year

Schiff Challenges the Bitcoin Growth Assumption

Economist Peter Schiff challenged the bitcoin instrumentality assumptions down Strategy Inc.’s (Nasdaq: MSTR) preferred-stock financing model. Writing connected Nov. 12 connected X, helium argued that caller losses undermined expectations of sustained appreciation supporting its payments. MSTR is the company’s common-stock ticker, chiseled from its income-paying STRC shares.

Addressing the economics down STRC, Schiff stated:

“The strategy down STRC is that due to the fact that the bitcoin MSTR owns volition admit by 30% per year, MSTR tin spend to wage STRC shareholders a 12% yearly output and inactive marque money. But past twelvemonth bitcoin mislaid 6.5%. So acold this twelvemonth it’s losing 17%. There’s nary ground to presume 30%.”

Michael Saylor, Strategy’s laminitis and enforcement chairman, projected mean yearly bitcoin appreciation of approximately 30% implicit 20 years successful a June 2025 CNBC interview. More recently, helium forecast yearly maturation of 20% to 30% implicit the adjacent 2 decades during an Oct. 13 Bloomberg interview. Both projections described semipermanent terms appreciation.

As of this writing, bitcoin traded adjacent $70,900, down 18.93% twelvemonth to date, extending the 17% diminution Schiff cited. The terms had fallen 3.74% implicit 24 hours, 6.53% implicit 7 days, and 14.52% implicit a month. It was besides 30.10% beneath its level a twelvemonth earlier.

Bitcoin’s terms connected Nov. 12, 2026, astatine 8:23 p.m. EST. Source: Bitcoin.com Markets.

Saylor had outlined the company’s bitcoin income framework connected Nov. 7. That exemplary combines bitcoin holdings with preferred shares, securities issuance, and firm currency management.

What STRC’s 12% Rate Represents

Strategy’s variable STRC dividend rate stood astatine 12% annually, based connected a $100 stated magnitude per share, the notation worth for dividend calculations. At that rate, payments full $12 a year; effectual output expresses yearly dividend income arsenic a percent of the acquisition price. Management evaluates the complaint monthly to promote trading astir $100.

Shareholders approved daily STRC dividend accrual successful October, allowing dividends to accumulate each calendar time starting Nov. 1. Accrual includes weekends and holidays, with associated payments processed connected concern days. More predominant distributions alteration the timing of payments alternatively than summation the annualized rate.

Owning STRC gives investors a assertion connected the issuing company, portion direct bitcoin ownership gives the holder the cryptocurrency itself. Bitcoin terms appreciation tin summation Strategy’s plus value, but unrealized gains bash not automatically nutrient dollars for dividends. Payments necessitate firm cash, which tin travel from financing oregon plus sales.

Bitcoin Sales and Buybacks Shape the Funding Picture

The company’s third-quarter fiscal results disclosed astir $431.8 cardinal successful bitcoin income during 2026 to money portion of its preferred dividends and STRC repurchases. It besides reported $5.07 cardinal successful dollar assets arsenic of Oct. 25, which it said covered astir 3.4 years of dividend and involvement obligations. Buybacks impact purchasing shares from investors, reducing the fig carrying aboriginal dividend claims.

Charles Schwab, a brokerage and fiscal services company, identified net volatility and imaginable liquidity unit successful its appraisal of bitcoin treasury risks. Liquidity unit means trouble gathering currency obligations erstwhile cryptocurrency holdings suffer value. Under market-value accounting, changes successful those holdings tin besides nutrient unrealized gains oregon losses successful reported earnings.

During Nov. 2-8, Strategy’s latest bitcoin purchases and STRC buybacks included $81.9 cardinal for 1,036 BTC and $188.3 cardinal for preferred shares, some financed done common-stock sales. Holdings reached 850,364 BTC, acquired for $64.16 billion. As of Nov. 8, its designated dollar reserve, acceptable speech for preferred dividends and indebtedness interest, totaled $4.77 billion, alongside $146.2 cardinal successful abstracted cash.