Long-time Bitcoin critic Peter Schiff has reignited debate over MicroStrategy's investment model, labeling it a Ponzi scheme and warning that any large-scale Bitcoin sale by the company would crash the market. The comments came after an X (formerly Twitter) user shared an email from their father, who expressed excitement about unexpectedly high dividend payouts from MicroStrategy (MSTR) that surpassed returns from traditional bank products. The shareholder reportedly reinvested those dividends into more MSTR shares, even as the broader crypto market declined.
Fans praised MicroStrategy for creating a product that lets investors benefit from Bitcoin exposure without directly owning the cryptocurrency, and for generating returns during a downturn. However, Schiff argued that MSTR differs fundamentally from businesses that produce income through productive economic activity. He asserted that the company can only sustain dividend payments by either raising additional capital or selling its Bitcoin holdings. Schiff further cautioned that if MicroStrategy were forced to liquidate its Bitcoin stash, it would trigger a severe price crash for BTC.
