MSTR•MSTR•Brad Garlinghouse criticized Michael Saylor's leveraged Bitcoin model, noting MicroStrategy's STRC preferred shares trade roughly 26% below $100 par value and dividend coverage has narrowed to 14 months. MicroStrategy sold 32 BTC in May to fund STRC payouts, marking its first liquidation to service dividend obligations.
Brad Garlinghouse labeled Michael Saylor’s borrow-to-buy approach a “damning indictment,” distinguishing between Bitcoin’s long-term utility and the financial engineering behind MicroStrategy’s strategy. He maintained his bullish stance on BTC while warning that leverage adds market pressure without creating real asset utility.
MicroStrategy’s STRC perpetual preferred shares traded around $74, roughly 26% below the $100 par value, reflecting investor concern over rising obligations. Annualized dividend payments have climbed to about $1.2 billion, and the coverage window has narrowed from over seven years to roughly 14 months, intensifying questions about sustainability.
In late May, MicroStrategy sold 32 BTC to fund the STRC dividend, marking its first sale of Bitcoin to service financial obligations. This move drew heightened scrutiny as analysts monitor the company’s balance sheet and capital structure under growing debt loads.
The widening discount on STRC and reliance on Bitcoin sales highlight the strain of MicroStrategy’s leveraged model. Investors are now assessing whether the company can maintain dividend commitments and absorb market volatility without undermining its core BTC holdings.
