Ripple CEO criticizes Saylor's Bitcoin financing strategy, calling STRC discount a "serious negative signal"

Ripple CEO Brad Garlinghouse criticized Strategy and its chairman Michael Saylor's Bitcoin purchasing financing model during a CNBC interview on Friday, stating that "financial engineering cannot create long-term value" and that the long-term value of digital assets should ultimately be driven by actual utility.

Garlinghouse said that the Saylor team is not focusing on the right direction and believes this approach has already harmed the overall crypto market. He also emphasized that he remains bullish on Bitcoin, but opposes Strategy's tactic of continuously accumulating BTC through complex financing structures.

His criticism was primarily directed at Strategy's model of issuing preferred stocks to finance Bitcoin purchases. STRC is one of the preferred stocks issued by Strategy, carrying an annual dividend obligation of 11.5%. Recently, STRC traded at a discount of approximately 25% to 26% relative to its $100 par value. Garlinghouse stated that this performance represents a "seriously negative assessment" of Strategy's approach.