Peter Schiff has issued a legal warning over Michael Saylor’s latest funding vehicle, arguing that Strategy’s STRC perpetual preferred stock could expose the company to investor lawsuits. His criticism centers on the claim that the product’s structure may give buyers a misleading sense of safety, especially if dividends are reduced or removed and the share price drops hard.
According to the report, STRC is designed to trade near $100 and pays monthly dividends with an annual yield of roughly 11.5%. Schiff said that setup could become a problem if market conditions change and the payout no longer holds. His warning was blunt: “It’s so misleading to constitute fraud. Get ready for the lawsuits when the dividends are cancelled and the stock craters.”
Debate centers on dividend durability
Schiff’s argument is not just about the headline yield. He is questioning whether investors are being given the right picture of the risks attached to a security that depends on continued confidence and funding support. If the dividend is touched, his view is that the reaction could be swift. A stable-looking instrument can reprice very fast when income expectations break.
He also repeated his broader criticism of Bitcoin-heavy financial strategies, saying investors should be careful with structures built around that exposure. The article did not cite a formal company response to the legal claim itself, but Saylor showed no sign of changing direction.
Strategy keeps using STRC-linked capital to add BTC
Despite the attack, Strategy is still expanding its Bitcoin position. The report says the company recently used capital raised through STRC to purchase another 23,934 BTC worth about $1.76 billion. That brought its total holdings to 780,897 BTC, with a stated value of nearly $59 billion.
Saylor answered critics with a short remark: “If this makes you uncomfortable, it’s working.” The comment fits his long-running approach of dismissing outside skepticism while continuing to build the company around Bitcoin accumulation.
MSTR rose, but Schiff’s concern is about a downturn
The report also noted that MSTR closed 3.76% higher at $148.94 on April 16, helped by stronger risk appetite tied to a ceasefire between Israel and Lebanon. Bitcoin moved up to $76,000 before trading around $75,000.
That rebound does not answer the question Schiff is raising. His focus is what happens if Bitcoin falls or funding slows. In that case, pressure on STRC could build quickly, and any change to the dividend policy could feed directly into the stock price. The dispute is now clear: Strategy is still leaning on the market to finance more Bitcoin purchases, while Schiff is warning that the structure behind STRC may face a legal test if the payouts fail.