Schiff: MicroStrategy’s Bitcoin plan can’t sustain 11.5% STRC yield

Peter Schiff renewed his criticism of MicroStrategy’s five-year Bitcoin treasury strategy, arguing the company cannot support the 11.5% annual dividend on its STRC preferred shares without major Bitcoin price gains.

Schiff posted on X that MicroStrategy has deployed about $64 billion into Bitcoin since adopting the strategy and now holds 818,869 BTC at an average cost near $75,540 per coin. He noted that with Bitcoin trading around $76,800 on May 23, the position sat only slightly above its cost basis and that the position’s total return remained negative as of that date.

STRC carries an 11.5% annual dividend rate for March 2026, the seventh consecutive monthly increase since the series launched in July 2025. MicroStrategy adjusts the STRC rate each month to keep the preferred shares trading near their $100 par value.

Schiff said covering an 11.5% annual payout would require Bitcoin to compound at roughly 30% per year, a rate he described as far above historical averages. He also pointed to ongoing STRC issuance, which he said raises the company’s dividend funding requirement as more shares enter the float.

Schiff repeated an earlier critique of the structure as self-reinforcing on the downside, arguing that weak Bitcoin performance would limit MicroStrategy’s ability to issue new shares at a premium and reduce cash available for dividends. He wrote, “Well it hasn’t even managed to earn 2.5% yet, even over five years, let alone every year for five years. Plus MSTR keeps issuing more STRC. So that 2.5% hurdle rate gets higher every week.”

Some participants in the thread contested Schiff’s framing. One argued MicroStrategy’s Bitcoin holdings exceed its dividend obligations and that a modest compound annual growth rate of about 2.5% would be sufficient to cover payments. Schiff rejected that figure, saying Bitcoin has not reached that level since MicroStrategy began accumulating. Another commenter said the main issue is retail investors misreading the volatility of a leveraged Bitcoin exposure.

MicroStrategy CEO Michael Saylor has publicly challenged Schiff to defend his position and has pointed to the company’s long-run price performance relative to traditional assets. MicroStrategy continues to add to its Bitcoin position and has not indicated any structural limit to its treasury approach.

Whether the narrow margin above cost supports Schiff’s warning or reflects a temporary price trough will depend on Bitcoin’s future price trajectory.