Ripple CEO Brad Garlinghouse criticized Strategy’s debt-and-preferred-stock Bitcoin accumulation model during a CNBC interview, arguing that crypto value should come from utility rather than
Ripple CEO Brad Garlinghouse criticized Strategy’s debt-and-preferred-stock Bitcoin accumulation model during a CNBC interview, arguing that crypto value should come from utility rather than capital-market engineering.
Garlinghouse said “financial engineering” does not drive long-term value and that durable value in digital assets is driven by utility. He also said Strategy’s approach has hurt the broader market, while stressing that he remains bullish on Bitcoin itself.
The sharpest criticism centered on Strategy’s STRC preferred stock. Garlinghouse called STRC trading about 25% below its $100 stated amount a “damning indictment” of the company’s financing strategy, because the preferred-stock discount shows investors demanding much more compensation to hold the securities funding Strategy’s Bitcoin accumulation.
The comments landed while STRC dropped below $76, extending the selloff in one of Michael Saylor’s most important preferred-stock vehicles. STRC’s discount has turned into a visible stress point because the security was designed to trade closer to par while paying an 11.50% annual cash dividend.
Strategy’s common stock has also been hit hard. MSTR recently traded near $82, keeping the stock roughly 85% below its November 2024 all-time high and leaving investors focused on whether the company can keep raising capital efficiently while Bitcoin trades far below Strategy’s average purchase price.
The stock’s decline had already pushed Strategy shares near a two-year low as the company’s Bitcoin treasury traded underwater. Strategy holds 847,363 BTC at an average cost of $75,651, while Bitcoin recently traded near $60,375.
That gap turns every funding decision into a market test. Common-stock issuance becomes more dilutive when MSTR is weak, while preferred-stock issuance becomes harder when STRC trades far below par. Strategy can still point to Bitcoin conviction, cash reserves and long-term treasury strategy, but the securities used to support that model are now being repriced by the market.
The pressure is no longer only about price action. A Rosen securities probe has added legal overhang to the MSTR and STRC selloff, covering Strategy securities trading under MSTR, STRF, STRC, STRK and STRD. That probe does not represent a court finding or regulator action, but it widens the investor-risk track around Strategy’s disclosures and capital structure.
Garlinghouse used the Strategy criticism to draw a broader line between utility-driven digital assets and balance-sheet engineering. Ripple’s own pitch remains centered on payments, liquidity and institutional settlement rather than holding Bitcoin as a leveraged treasury asset.
That argument has become more central to Ripple’s public positioning after its acquisitions and payments expansion. Garlinghouse has pointed to large legacy payment flows processed by acquired businesses, with almost none of that volume moving through crypto rails, as evidence that the real opportunity is moving institutional payments and treasury activity onto faster digital infrastructure.
Ripple’s utility argument also sits behind its XRP and stablecoin strategy. The company has continued to frame XRP, RLUSD and Ripple Payments around settlement, cross-border liquidity and institutional workflows, even as XRP itself remains exposed to market cycles and technical weakness.
Garlinghouse’s critique now puts Ripple directly against Saylor’s Bitcoin-treasury model. Strategy remains focused on accumulating BTC through securities issuance and long-term Bitcoin exposure, while Ripple is arguing that crypto winners will be defined by payments utility, settlement volume and real institutional usage. MSTR traded near $82, STRC remained about 25% below par and Bitcoin held near $60,375 as that debate moved from theory into live market stress.
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