Bitcoin News Today: "Strategy's Bitcoin Gamble Faces Critics' Debt Doomsday"

Strategy, the Bitcoin-focused holding company led by billionaire Michael Saylor, has continued its aggressive accumulation of the cryptocurrency despite a broader market downturn, purchasing 8,178 BTC for $835.6 million at an average price of $102,171 per coin in the week ending November 16. This brings the firm's total Bitcoin holdings to 649,870 BTC, valued at approximately $61.7 billion at current prices, making it one of the largest institutional holders of the asset. The purchase was funded through the issuance of preferred stock, including $131.2 million in net proceeds from the sale of Variable Rate Series A Perpetual Stretch Preferred Stock (STRC) and other equity offerings.

The move underscores Strategy's commitment to treating Bitcoin as a core reserve asset, even as the cryptocurrency has declined by over 20% from its October peak above $125,000. The firm's average purchase price remains at $74,433 per coin, yielding a 27.8% return year-to-date in 2025. However, the company's stock (MSTR) has suffered, dropping more than 50% since July and trading at $199 as of November 16, with its market capitalization briefly dipping below the value of its Bitcoin holdings in mid-November.

Critics, including economist Peter Schiff, have labeled Strategy's business model a "fraud," arguing that its reliance on issuing high-yield preferred shares-such as STRC, which offers a 10.5% yield-creates an unsustainable debt structure. Schiff, a vocal gold advocate, challenged Saylor to a public debate at Binance Blockchain Week in Dubai in December, claiming that the firm's stock will eventually collapse as investors realize the promised yields are not guaranteed. "Once fund managers dump the preferreds, Strategy will be unable to issue more debt, setting off a death spiral," Schiff wrote on X.

Meanwhile, the broader crypto market has seen a shift in investor sentiment. While Bitcoin and Ethereum ETFs have lost over $4.2 billion in combined outflows since late October, newer altcoin ETFs tracking Solana and XRP have attracted $500 million in inflows, highlighting growing interest in smaller cryptocurrencies. VanEck's zero-fee Solana ETF (VSOL), launched in October, and Canary Capital's XRP ETF have drawn particular attention, contrasting with the struggles of Bitcoin-focused funds.

Despite the criticism, Saylor remains bullish. In a November 14 tweet, he cited Bitcoin's "strong fundamentals" and limited supply as reasons for confidence in its long-term value, while noting that open interest in Bitcoin futures has fallen to $64 billion from a $94 billion peak in October. The firm's stock has also retained retail support, with bullish sentiment on platforms like Stocktwits remaining strong.