Peter Schiff Says Strategy’s STRC Is a Ponzi Scheme: Here’s Why

Strategy’s software business generates revenue, but Schiff says it’s not enough to cover the 11.5% annual profit across STRC releases.

Bitcoin critic Peter Schiff held a live podcast on

The space lasted for about two hours, with Schiff using most of that time to explain why he believes the product will ultimately leave retail investors with nothing.

Why does Schiff say the math doesn’t work?

Chef open Space with textbook definition:

“Ponzi, by definition, is when the income paid to existing investors comes from bringing in new investors, and then you take the money from the new investors and use it to make payments to the old investors,” he said.

He also claimed that the strategy had no meaningful income. Yes, its software business generates some revenue, but nowhere near enough to cover the dividend obligations of STRC, which pays its holders 11.5% annually in monthly dividends.

As such, STRC fits this mold directly because the strategy raises money by issuing new shares of preferred stock, uses those proceeds to pay dividends to existing STRC holders, and then must issue more shares to pay the next round of stockholders.

“How does STRC make payments when the company itself has no income?” Shiv asked. “The 11.5% yield on STRC is paid by selling more STRC shares, then taking money from new investors to pay old investors.”

The strategy was to buy Bitcoin aggressively. Last week, it spent $2.54 billion acquisition 34,164 BTC at an average price of $74,395, bringing their total holdings to 815,061 BTC, purchased for approximately $61.56 billion at an average price of $75,527.

STRC has been the financing engine for such purchases, with preferred stock to hit A new record for single-day trading volume was set on April 13, when it brought in $1.1 billion, an amount 46.5% higher than the previous record and more than four times its 300-day average of about $274 million.

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Stocks can go to zero

Schiff noted that Strategy has no legal obligation to continue paying STRC dividends since that is discretionary. The owners cannot force them to pay and cannot redeem their shares; They can just sell it. So, if Saylor stops paying, the returns disappear, demand collapses, and shares go to zero.

“It’s IOUs for nothing,” the goldbug claimed.

The return itself tells the story, he said. It started at 9% when the STRC was launched in July 2025 and has been raised several times since then, reaching 11.5% since April. According to Schiff, demand for STRC continues to decline, so prices continue to rise to attract new buyers.

“They keep raising it as the supply of suckers dries up.”

One listener in the space responded by saying that the strategy was able to pay off its debt, as the current value of its Bitcoin holdings is well above the company’s market capitalization, meaning it can sell Bitcoin and pay off all shareholders comfortably. But Schiff was having none of it, saying that if a company tried to sell its bitcoin, prices would fall.