Peter Schiff is taking his victory lap — at least for now, and he’s doing it at Michael Saylor’s expense.
The outspoken gold proponent and perennial Bitcoin bear has seized on the latest drawdown to argue that Strategy’s hyper-aggressive accumulation strategy is finally backfiring. After years of buying every dip and turning the company into a de facto Bitcoin holding vehicle, Strategy now finds itself roughly 630 million dollars underwater on its position, wiping out about 47 billion dollars in unrealized profits that existed just four months earlier. The trigger: Bitcoin sliding below the firm’s average purchase price of 76,037 dollars.
In the first four days of February alone, Bitcoin sank around 15%. That sudden drop was enough to push Strategy’s holdings into the red for the first time since Saylor began building the position in August 2020. Even with the pullback, Bitcoin is still up approximately 550% from the time of that initial bet. But the recent correction has highlighted how aggressively the company kept buying near the most recent highs, leaving little cushion when volatility returned.
Schiff argues this isn’t just bad timing — it’s structural. From his perspective, Strategy’s relentless buying helped propel Bitcoin’s “meteoric” rise on the way up, and now the unwind of that momentum is amplifying the fall. On X, he claimed that the company’s shrinking ability to keep purchasing is no longer a tailwind, but a headwind for the market. In his words, Bitcoin won’t truly find a bottom “until after Strategy sells its last satoshi.”
In essence, Schiff is accusing Strategy of becoming both the gasoline and the match: a major source of demand that pushed prices higher and a potential overhang that could weigh on prices if the company is ever forced to slow down or reverse course. His critique taps into a growing concern that a single corporate actor holds too much influence over the largest cryptocurrency’s price dynamics.
That criticism zeroes in on Strategy’s core business model. The company has been using a playbook that depends heavily on buoyant Bitcoin prices: issue new shares at levels above the firm’s net asset value, use the capital raised to buy more Bitcoin, and repeat. As long as the market cooperates, this loop enlarges both the balance sheet and the Bitcoin stash. But if Bitcoin trades below the company’s average cost for a prolonged period, that flywheel becomes more difficult to spin. Investor appetite for new stock might cool, and dilution becomes harder to justify.
Despite these mounting questions, Saylor has shown no public sign of doubt. As the market slid, he responded with trademark maximalism, restating his simple credo online: the “Rules of Bitcoin” are to buy it and never sell it. That message is meant to signal conviction — to shareholders, to Bitcoin holders, and to skeptics like Schiff — that volatility is noise and the long-term thesis remains intact.
At a Bitcoin-focused event in the Middle East and North Africa in December, Saylor presented Strategy not as a reckless, concentrated bet, but as a bridge for mainstream capital into the asset. He claimed that around 15 million beneficiaries now have Bitcoin exposure through the company’s securities, whether via pension funds, insurance companies, sovereign wealth funds, or individual brokerage accounts. He also highlighted that a sizable chunk of Strategy’s equity is held by retail investors through a major brokerage, turning what looks on paper like corporate concentration into a more diffuse form of ownership.
According to Saylor, the ripple effect is even larger. He has argued that Strategy has already given indirect Bitcoin exposure to roughly 50 million people, with a longer-term aim of reaching 100 million. In his telling, this is not merely about one company’s balance sheet, but about building the distribution rails through which everyday savers, institutions, and funds can participate in the Bitcoin story without holding coins directly.
Saylor goes further, claiming Strategy’s actions have added around 1.8 trillion dollars to Bitcoin’s market capitalization over time, with most of that incremental value accruing to holders outside of corporate and institutional circles. He positions the company not as a dominant whale that might someday dump the asset, but as a catalyst that has raised the entire market’s valuation and widened its base of ownership.
A key fear among critics is that Strategy, which controls around 3% of Bitcoin’s total supply, poses a systemic risk: what happens if it needs to liquidate? Saylor dismisses that as a misunderstanding of how ownership really works. In his narrative, the company is more akin to a wrapper that slices that 3% into millions of small exposures spread around the world. He also suggests that if corporate and institutional allocations continue to grow and Bitcoin’s price climbs by orders of magnitude, the real winners in dollar terms will still be the non-corporate holders who benefit from the expanded network and liquidity.
At the center of Saylor’s thesis is a simple, unwavering idea: Bitcoin cannot reach truly massive valuations without deep corporate participation. Without balance sheets, funds, and public companies stepping in, he argues, the asset would likely be stuck near 10,000 dollars with modest adoption. With them, he envisions a path not just to trillion-dollar territory — where Bitcoin already briefly touched — but potentially into the tens or even hundreds of trillions as a global monetary asset.
Schiff, unsurprisingly, sees this as wishful thinking layered on top of a speculative bubble. From his vantage point, Strategy’s recent paper losses validate his long-standing warnings about corporate speculation on an asset he frequently labels as fundamentally valueless compared with gold. The current downturn is, for him, an opportunity to underline the dangers of using corporate equity and debt to finance what he views as a leveraged crypto gamble.
The market, meanwhile, is caught between these two starkly different interpretations. On one hand, the correction could be just another in Bitcoin’s long history of brutal but temporary pullbacks — episodes that have repeatedly shaken out weak hands before the next leg higher. On the other, the sight of a flagship corporate holder sitting on losses at scale raises the possibility that this time may force a recalibration of the “Bitcoin-first” corporate strategy.
For investors, the situation raises several practical questions. How resilient is Strategy’s funding model if Bitcoin remains below its average cost for quarters rather than weeks? Will equity investors continue to accept dilution in exchange for a larger Bitcoin trove if recent purchases are underwater? And if the company were ever compelled to sell, how would that affect a market accustomed to counting Strategy as a constant buyer?
There is also the broader reputational angle. Strategy has been held up as a pioneer, showing other CFOs and boards how to convert idle cash into what Saylor calls a “high-energy monetary asset.” If its bold bet begins to look like a cautionary tale instead, that could chill corporate enthusiasm across the board. Potential adopters might think twice about putting treasury reserves into such a volatile asset if they see shareholder value whipsawed by market swings.
Yet it’s important to remember that Bitcoin’s story has never been linear. The asset has endured repeated boom-and-bust cycles, with each new high followed by sharp drawdowns that critics call the end and supporters call a discount. Strategy’s approach effectively magnifies that volatility at the corporate level. When prices are rising, the model appears visionary; when they fall, leverage and concentration dominate the conversation.
One underappreciated dimension is the psychological impact on retail investors who hold Strategy shares rather than Bitcoin directly. Many of them are effectively using the stock as a proxy for Bitcoin exposure, whether by design or by accident. They feel every spike and crash twice — once through Bitcoin itself, and again through the equity market’s judgment of Strategy’s risk profile and capital allocation decisions.
Regulators and policymakers are also likely to watch developments closely. The more public companies tie their fate to a highly volatile digital asset, the more questions arise about disclosure, risk management, and systemic contagion. A sharp, sustained downturn in Bitcoin that inflicts heavy damage on corporate balance sheets would add fuel to ongoing debates over how deeply traditional finance should intertwine with crypto.
For now, the scoreboard is mixed. Bitcoin remains dramatically higher than when Strategy first entered the market, and long-term holders are still sitting on hefty gains relative to pre-2020 prices. But the short-term narrative has shifted: instead of celebrating unprecedented profits, the conversation is about breakeven levels, unrealized losses, and whether the strategy is as bulletproof as it was made to sound.
Schiff is capitalizing on that shift, using every downtick as evidence that the foundation was shaky all along. Saylor, in contrast, is leaning into volatility as proof of Bitcoin’s scarcity and free-market nature, reaffirming his commitment to never sell. Between these poles lies the uncomfortable truth for investors: the outcome is still uncertain, and both men could look prescient or misguided depending on what Bitcoin does next.
What markets are really wrestling with now is not just whether this sell-off is temporary, but whether Strategy’s experiment with a Bitcoin-centered corporate identity can withstand a full-blown bear phase. If the company emerges intact and continues to buy through the pain, Saylor’s long-term vision will gain credibility. If, however, financial or market pressure forces a retreat, Schiff will have far more than a single victory lap to point to.
Until that verdict arrives, Bitcoin’s price action will continue to serve as a running referendum on both men’s worldviews — and on the risks and rewards of tying a public company’s fate to the most volatile major asset in modern finance.