In a recent CNBC interview, Ripple CEO Brad Garlinghouse expressed his continued confidence in Bitcoin’s long-term potential, while simultaneously criticizing Michael Saylor’s methods for financing the company’s Bitcoin acquisitions. His comments come as the preferred stock used in MicroStrategy’s accumulation model has plummeted to record lows.
“Financial engineering does not drive long-term value,” Garlinghouse stated, emphasizing that the enduring worth of any digital asset is derived from its utility. “Team Michael Saylor wasn’t focused on the right stuff, and that has hurt the overall market.”
Despite his critiques of the corporate strategy, Garlinghouse clarified that his bullish outlook on Bitcoin itself remains unchanged.
The crux of Garlinghouse’s criticism lies in the mechanism MicroStrategy has utilized to amass Bitcoin. For approximately one year, the company has issued preferred shares—a stock class that provides fixed dividends—to generate capital for further Bitcoin purchases.
The company’s STRC shares offer an 11.5% annual dividend and are designed to trade near a $100 valuation. Garlinghouse noted that STRC is currently trading roughly 25% below that target, describing the price decline as a “damning indictment” of the current strategy.
