Ripple CEO Brad Garlinghouse questioned Michael Saylor’s influence on the wider crypto market during a Friday CNBC interview, while keeping a bullish stance on Bitcoin itself.
Garlinghouse focused on Strategy’s Stretch preferred stock, known as STRC, which has traded far below its intended $100 par value.
The instrument was structured to remain near that level while paying an 11.5% annual dividend. However, it closed the weekend at $74.57, leaving it at a discount of about 26%.
Garlinghouse described that gap as “a pretty damning indictment.” He said the issue was not Bitcoin, but Strategy’s funding model.
“Financial engineering does not drive long-term value,” Garlinghouse said. “Team Michael Saylor wasn’t focused on the right stuff, and that has hurt the overall market.”
Leverage Concerns Add Pressure on Strategy
Garlinghouse also warned that Strategy’s use of leverage to increase exposure during Bitcoin rallies can deepen losses when markets decline. “You start to see that in a place that can actually compound negatively,” he told CNBC.
The comments arrived as Strategy faced pressure across its capital structure. Its common shares closed near $82 on Friday, their lowest level since February 2024. Bitcoin, the firm’s main reserve asset, also slipped near $59,000.
Strategy’s annualized dividend commitments across preferred share classes have risen to roughly $1.2 billion. The company has acknowledged the related financial pressure in its disclosures.
In late May, Strategy sold 32 Bitcoin for $2.5 million to fund a dividend payment. The sale drew attention because the company still held 843,706 Bitcoin, purchased for nearly $64 billion. It also marked the first known sale of its Bitcoin holdings since at least December 2022.
CryptoQuant research head Julio Moreno estimated that Strategy’s dividend runway had fallen from more than seven years to about 14 months. CryptoQuant separately advised a Strategy to slow Bitcoin purchases and strengthen cash reserves. The preferred share discount became a central point in Garlinghouse’s CNBC criticism of Strategy’s overall approach and funding structure.
Garlinghouse Separates Bitcoin From Saylor
Garlinghouse stressed that his criticism was aimed at Strategy’s structure, not Bitcoin. He repeated his long-term bullish view of “digital gold” and said lasting value depends on utility.
He pointed to Ripple’s XRP-based cross-border payments and prime brokerage infrastructure, which handled nearly $16 trillion in volume last year.
Saylor has continued defending Strategy’s Bitcoin-first approach. During the week, he promoted STRC by saying, “Digital Credit is income for investors who believe in Bitcoin.”
Strategy is down about $13 billion on the cash paid for more than 847,000 Bitcoin, according to BitcoinTreasuries data cited by Cryptopolitan. That paper loss roughly matches STRC’s discount to par.
