Michael Saylor defended Strategy’s Bitcoin-backed credit model after critics claimed the company’s STRC dividend structure resembled a Ponzi scheme, saying the company was built around monetizing Bitcoin capital gains rather than perpetually issuing shares.
Speaking in an interview shared via The remark attracted attention because Saylor has long been associated with the phrase “never sell your Bitcoin.”
According to Saylor, the most accurate phrasing is that Strategy does not intend to be a “net seller” of Bitcoin.
“I’m very famous for saying never sell your Bitcoin. And that’s why the internet went crazy when we said we might sell it,” Saylor said. “But if I were more specific, I would say never be a net seller of Bitcoin. It just wouldn’t have been that viral or that catchy to say never be a net seller of Bitcoin.”
Why the Strategy Is Not a Bitcoin Ponzi Scheme
The issue became a point of contention after Peter Schiff and other critics suggested that Strategy’s willingness to sell Bitcoin to support STRC’s dividends exposed the model’s weakness. Saylor rejected this language, saying the company’s balance sheet should not be treated as if its Bitcoin holdings were unusable or worth zero.
“If you have something worth $65 billion and people want to value it at zero, that’s not very good,” he said. “We don’t want the rating agencies to think the company has $0 in assets. We want the rating agencies to think we have $65 billion in assets.”
Saylor said the basic model is simple: The strategy issues credit, uses the proceeds to buy Bitcoin and expects the long-term appreciation of the asset to exceed the cost of the dividend. He likened the structure to a real estate development company raising capital through credit, acquiring land, improving it, then monetizing the added value through sale, rental or refinancing.
“What we want to do is strengthen the business model, is sell credit to make an equity investment in an asset, Bitcoin, digital capital,” Saylor said. “The capital investment accumulates over time faster than the dividend. We then monetize the capital gain and pay the dividend.”
This distinction is at the heart of Saylor’s response to the Ponzi allegations. Critics, he says, confuse the sale of common stock to fund dividends with the broader economic structure of the company. He said Strategy historically used MSTR stock, which he described as a Bitcoin derivative that typically trades at a premium to Bitcoin, to fund dividends. But the company now wants the market to understand that it could also use the appreciated Bitcoin directly.
Saylor said this does not mean Strategy expects to reduce its Bitcoin position. He argued that even if the company sold Bitcoin for dividend payments, its credit issuance would allow it to buy significantly more Bitcoin than it sells.
“If we sell Stretch, if we issue a Stretch Credit equal to 2.3% of our Bitcoin holdings, that means we will forever be a net buyer of Bitcoin, even if we sell Bitcoin to pay the dividend,” he said. “Another point is that if Bitcoin appreciates at 2.3% per year, we can pay the dividends forever, right? And continue to grow in value, right? And we can do it without selling any common stock.”
He added that Strategy sold $3.2 billion worth of STRC in April, when the required monthly dividend was around $80 million to $90 million. In this scenario, he said, the company would “effectively buy 30 Bitcoins and sell one Bitcoin,” making it a net accumulator.
The interview also directly responded to Schiff’s criticism. Saylor said Schiff’s objection begins with a rejection of BTC itself, making it unlikely he would accept a credit instrument built on it.
“Peter thinks Bitcoin is a Ponzi scheme. Peter is not really a lover of anything in this space,” Saylor said. “Bitcoin is digital capital and we created a digital treasury company by selling stocks and credit instruments to buy capital. I think Bitcoin will continue because it represents economic wealth in symbolic form with full ownership rights for the world.”
Saylor described STRC as a form of “digital credit” designed to remove some volatility from Bitcoin while still producing a defined return. He said Strategy oversized the instrument, with “for every $5 worth of Bitcoin,” the company sold “$1 worth of credit.”
“If you don’t recognize Bitcoin as legitimate, you will never recognize any derivative as legitimate,” he said. “But for those who believe that Bitcoin is digital capital, as a store of economic wealth in token form, what we are doing is very simple.”
At press time, BTC was trading at $80,929.
Featured image from YouTube, chart from TradingView.com
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