Ripple CEO Says Saylor’s Bitcoin Playbook Is Hurting the Whole Crypto Market

TLDR

• Ripple CEO Brad Garlinghouse said Strategy’s preferred-share funding model has hurt the broader crypto market
• He called it “financial engineering” that does not drive long-term value
• Strategy’s STRC preferred stock hit a record low, trading 25% below its $100 par value
• Strategy’s common stock dropped to its lowest level since February 2024, closing around $82
• CryptoQuant urged Strategy to pause bitcoin buying and rebuild cash reserves

Ripple CEO Brad Garlinghouse said he is still bullish on bitcoin. But he made clear he has a problem with how Michael Saylor has been buying it.

In a CNBC interview on Friday, Garlinghouse criticized Strategy’s method of issuing preferred shares to raise cash for bitcoin purchases. He called it “financial engineering” and said it has damaged the wider crypto market.

Garlinghouse runs Ripple, the company behind XRP, which is a rival to bitcoin. Despite that rivalry, he said his issue is not with bitcoin itself, but with the funding approach.

How Strategy’s Model Works

For about a year, Strategy has been issuing preferred shares to fund bitcoin purchases. Its STRC preferred stock pays an 11.5% annual dividend and was designed to trade near $100.

But on Thursday, STRC fell to a record low, trading as much as 26% below that $100 par value. Garlinghouse pointed to this as a “damning indictment” of the strategy.

Strategy’s common stock also dropped, hitting its lowest level since February 2024. It closed at around $82 on Friday. Bitcoin itself fell below $59,000 during the week.

When STRC trades below $100, Strategy’s ability to issue new shares and buy more bitcoin is effectively stalled. The company has paused that activity.

Analysts Weigh In

CryptoQuant released a report this week saying Strategy should halt bitcoin purchases and focus on rebuilding its cash reserves. The firm said the cushion backing STRC’s dividend payments has dropped from over seven years of coverage to just around 14 months.

Benchmark-StoneX analyst Mark Palmer pushed back on the most dire comparisons. He said Strategy’s funding engine has become “less efficient” but is not broken. He rejected comparisons between STRC and assets that have fully collapsed.

The pressure on Strategy’s model has been building throughout the week. The combination of falling bitcoin prices and a declining STRC has put the company in a difficult position.

Garlinghouse’s criticism adds a high-profile voice to growing questions about whether Strategy’s preferred-share approach is sustainable. He tied the model’s problems directly to bitcoin’s recent slide below $59,000.

His core argument is that lasting value in crypto comes from utility, not complex financial structures.

As of Friday, STRC remains well below its $100 par, and Strategy’s common stock continues to trade near multi-year lows.

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