The debate between gold and bitcoin is taking a new turn. Peter Schiff accuses Michael Saylor of running Strategy according to a model “fraudulent” based on promises of illusory returns. He is offering a public debate during Binance Blockchain Week in Dubai in December. In a turbulent market, this confrontation crystallizes tensions around the integration of bitcoin into business strategies.
In brief
- Peter Schiff accuses Michael Saylor of building Strategy's economic model on a “fraud”, based according to him on fictitious returns.
- The pro-gold economist says Strategy's preferred shares will fail to deliver on their promises, threatening the company's viability.
- He challenges Michael Saylor to a public debate during Binance Blockchain Week, scheduled for December in Dubai.
- Bitcoin's decline and gold's stable performance are fueling criticism of the strength of the “Bitcoin in Business” model.
Peter Schiff denounces a mechanism of financial fraud
While Michael Saylor prepares a new massive purchase of bitcoin, Peter Schiff in a series of public statements made a frontal accusation against the Strategy company, claiming that its business model rests on unstable and potentially misleading foundations.
On X, the pro-gold economist said Strategy's model “relies on income-oriented funds that purchase its high-yielding preferred stocks”. Furthermore, he claims that these returns will never actually be paid out. For him, this promise of profitability masks an untenable strategy in the medium term.
Here is the main accusations formulated by Peter Schiff:
- A model based on the issuance of preferred shares: according to him, Strategy seduces investors with high returns displayed, but these would be illusory;
- The risk of massive sales by funds: “once fund managers realize this, they will get rid of these preferred stocks”he affirms;
- A systemic danger for Strategy's financial structure: Schiff warns that this dynamic could trigger a “death spiral”making it impossible to issue new debt.
This verbal offensive did not stop there. Schiff proposed a public debate with Michael Saylor, founder and central figure of Strategy, during the Binance Blockchain Week in Dubai, scheduled for December.
He intends to confront his critics with Saylor's arguments, in a face-to-face encounter which could have repercussions on the overall perception of this model.
Market signals that weaken the Strategy model
Apart from Peter Schiff's statements, several recent financial indicators highlight a form of fragility in Strategy's current situation.
The mNAV (multiple to net asset value), a key metric for gauging the premium that markets place on the company's Bitcoin holdings, fell below 1 in November, a symbolic level that indicates a discount to its own reserves.
Although this ratio has rebounded slightly to 1.21, it remains far from the threshold of 2, generally considered healthy for this type of structure. At the same time, Strategy shares have lost more than 50% since July, stabilizing around $199, reflecting clear investor distrust.
This deterioration in valuation occurs in an unfavorable macroeconomic context for the crypto market, marked in particular by a 20% fall in the price of bitcoin since its peak at $126,000 in October, itself followed by a Crash on October 10.
At the same time, gold, an asset defended by Schiff, experienced an opposite trajectory. It remained above the psychological threshold of $4,000 per ounce, even reaching a record at $4,380. This dynamic indirectly strengthens Schiff's credibility in the eyes of certain traditional investors.
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