MicroStrategy's Bitcoin Buying Power Dented by Lack of Funding

Peter Schiff, a longtime Bitcoin critic, says MicroStrategy has lost its ability to buy more Bitcoin due to a lack of funding. According to Schiff, the company's preferred stock, STRC, has been pulled back towards its $100 par value, but it no longer has the issuance channel that funded its Bitcoin purchases.

However, MicroStrategy has continued to buy Bitcoin, funding its latest purchase with proceeds from common stock sales. The company sold STRC through its at-the-market program in May, raising about $1.95 billion, but has since relied on other funding sources, including common stock sales and its USD Cash account.

Schiff credits the company's weekly STRC buybacks and the recent Bitcoin rally for STRC's recovery. The stock had sunk to about $75 earlier this year, but has since recovered to trade near $99.4, a move Schiff admits was unexpected.

Schiff expects Bitcoin to roll over once tech stocks pull back, but notes that MicroStrategy has enough cash to keep paying STRC dividends for a little longer before it runs out.