Renowned gold advocate and Bitcoin critic Peter Schiff has argued that companies operating on a “Bitcoin treasury” model are in deep crisis following the crypto market’s collapse.
Schiff said the business model of companies that put Bitcoin at the center of their balance sheets, especially MicroStrategy (now Strategy), is unsustainable.
Schiff says these companies will not be able to withstand market pressures because they lack real business. The analyst noted that BTC price fluctuations are weakening financial institutions whose balance sheets are based entirely on BTC. He added: “If you start a company and base your sole business model on buying Bitcoin, you don’t actually have a business. Anyone can buy Bitcoin. You don’t need a company to do that.”
Schiff specifically targeted the strategy, saying the company had maintained an “absurd model” for years. He noted that the company’s equity premium has eroded significantly and the stock now offers virtually no added value compared to a Bitcoin portfolio. The analyst noted that Strategy stock has lost about 65% of its value since last year, suggesting the decline will continue.
Schiff said the most significant risk is that Strategy loses access to capital markets. The analyst noted that the company has been financing its Bitcoin purchases by selling new and preferred stock, but this avenue will be completely closed if the stock price falls below the value of Bitcoin. He claimed that in such a scenario, the company would be unable to continue making new BTC purchases and would “enter a period of collapse.”
These announcements come as Bitcoin’s sharp decline and ETF outflows in recent weeks have strained institutional investors. At the latest price, BTC is trading at $84,171, down nearly 12% this week.
*This is not investment advice.
