Bitcoin News Today: Gold Bull Challenges Bitcoin's Survival in High-Stakes Debate

Peter Schiff, a longtime critic of Bitcoin and advocate for gold, has escalated his public feud with Michael Saylor's Strategy (MSTR), accusing the Bitcoin-focused company of operating a fraudulent business model. The gold investor challenged Saylor to a live debate during Binance Blockchain Week in Dubai in December, framing the confrontation as a pivotal moment to test the sustainability of MSTR's approach.

Schiff's criticism centers on MSTR's reliance on "high-yield" preferred shares, which he argues will never deliver promised returns. "Once fund managers realize this, they'll dump the preferreds," Schiff wrote on X, warning that this could trigger a "death spiral" as the company loses access to new debt issuance. The model, he explained, depends on income-oriented funds purchasing these shares, but the yields are not guaranteed. Dividends, he noted, are discretionary and do not accumulate if unclaimed, leaving investors with no recourse.

The debate challenge comes as Bitcoin (BTC) faces renewed pressure. The cryptocurrency recently fell below $99,000, a key psychological level, and has lost over 20% from its October peak above $125,000. Strategy's stock has also declined sharply, dropping nearly 50% since July and trading at around $199 as of late November. The firm's multiple on net asset value (mNAV), a metric comparing its stock price to the value of its Bitcoin holdings, dipped below 1 in November but has since rebounded to 1.21 - a level still considered low by industry standards.

Schiff's critique gained traction amid broader market shifts. Gold, which he champions, has outperformed Bitcoin, trading above $4,085 per ounce and nearing its October high of $4,380. This has fueled his argument that Bitcoin's capped supply of 21 million coins is a flawed foundation for value, a claim he has repeatedly made while urging investors to shift from BTC to silver.

Saylor, however, has defended MSTR's strategy. In an August earnings call, he asserted the company could withstand an 80% drop in Bitcoin's price without missing a dividend. The firm's long-term buy-and-hold model, he argued, benefits from a low average purchase price due to years of accumulation. Critics, though, liking MSTR's reliance on continuous fundraising to a Ponzi scheme, where new capital services existing debts.

The market's reaction to Bitcoin's recent volatility has further intensified scrutiny. On November 13, MSTR's market capitalization briefly fell below the value of its Bitcoin holdings, raising concerns about forced asset sales. Meanwhile, Schiff has also challenged Binance founder Changpeng Zhao to a debate on whether tokenized gold or Bitcoin better fulfills the criteria of money, adding another layer to the broader crypto-gold rivalry.

As the debate over MSTR's viability unfolds, investors are watching closely. Saylor's ability to sustain the company's growth amid crypto market downturns - and Schiff's push to validate gold as a superior store of value - will likely shape the narrative in the coming months.