Schiff Warns Saylor's Bitcoin Fund Faces Funding Crunch

Bitcoin critic Peter Schiff has expressed concerns over Strategy's (MSTR) plans to fund future Bitcoin purchases. According to Schiff, despite the recent surge in Bitcoin price, STRC shares are still trading under their $100 target.

Strategy recently sold 18.26 million MSTR shares and raised $2 billion. The company allocated $300 million into its USD Reserve and used another $136.4 million to repurchase 1.43 million STRC preferred shares.

Schiff argues that Strategy may face difficulties raising fresh funds for future BTC purchases, as the company's stock price has not gained much momentum despite the Bitcoin price's growth. He points out that if Strategy continues using its funds to buy back preferred shares instead of issuing new ones to fund BTC purchases, the amount of Bitcoin backing each common MSTR share could decline.

Strategy has $5.1 billion in its USD Reserve and $1.59 billion in USD Cash, giving it a total dollar liquidity of $6.69 billion. This cash pool can be used for various corporate needs, including debt payments and share buybacks.