STRC多空激辯：13%股息背後的「類龐氏」爭議

Original translation: 律動小工，律動 BlockBeats

Editor's note: STRC is a perpetual preferred stock launched by Strategy (formerly MicroStrategy) in July 2025. It has a face value of $100, a floating interest rate, pays dividends monthly, and its price is anchored near $100 through monthly dividend rate adjustments. The product's design philosophy is to provide Strategy with a new financing engine to continuously purchase Bitcoin by offering a seemingly low-volatility, high-yield fixed-income instrument (with the annual dividend rate rising from 9% to 11.5%).

Its capital absorption capacity over the past few months has been staggering. Launched in July 2025, the issuance size was increased by the market from the original plan of $500 million to $2.521 billion, setting a record for the largest IPO in the US in 2025, surpassing Circle. At the end of March this year, Strategy paused its 13-week "Orange Dot" Bitcoin accumulation streak. Saylor shifted his full focus to STRC. By April 10th, the funds raised by STRC in a single week were enough to buy 8,000 Bitcoins. Saylor’s own calculation is that as long as Bitcoin appreciates by 2.13% annually, STRC's dividends can be paid indefinitely.

However, this has also sparked controversy on Wall Street.

First, "Russian nesting dolls" began to appear. In March, another Bitcoin treasury company, Strive (founded by Vivek Ramaswamy), used one-third of its corporate cash ($50 million) to buy Strategy's STRC. A Bitcoin-holding company uses a third of its money to buy preferred stock issued by another Bitcoin-holding company. Strive's Chief Risk Officer, Jeff Walton (one of the participants in this debate), called STRC a "high-quality credit product with a better risk-reward ratio than traditional fixed income" on Twitter. Critics summed it up more bluntly: a company that hoards Bitcoin uses a third of its funds to buy dividend certificates from another company that also hoards Bitcoin – this isn't diversification, it's a matryoshka doll. Each layer promises double-digit returns to investors, and the confidence for each layer's payout comes from the same thing: Bitcoin cannot fall.

Second, Strive itself is playing the same game. While buying STRC, Strive raised the dividend rate on its own perpetual preferred stock, SATA, from 12% to 12.75%, and pushed it to 13% a few months later. Structurally, Strive is using STRC (annualized 11.5%) as partial reserves to support a 13% product, SATA. 11.5% on the left hand, 13% on the right, with Bitcoin's volatility sandwiched in between.

Third, MSTR's own situation is not easy. MSTR's stock price has been under continuous pressure this year. Bitcoin's significant pullback from its highs last year once broke through Strategy's average cost basis of $76,000. Strategy's paper losses once exceeded $7 billion. But management didn't choose to contract; instead, they went "all-in on preferred stock." Of the $42 billion ATM offering plan approved in March, half of the quota was directly allocated to STRC. They stopped buying BTC on one hand while aggressively issuing STRC to raise funds for buying BTC on the other. Coffeezilla is a well-known American investigative YouTuber focusing on scams. He made a video characterizing the STRC and SATA schemes as "Ponzi-like." Strive's Chief Risk Officer, Jeff Walton, directly confronted him, demanding a public debate, which led to this 90-minute clash. This is the full background for the conversation below. The following is the main text of the dialogue, moderately edited and condensed by BlockBeats without altering the original meaning.

Coffeezilla: Today we have Jeff Walton. Their company is doing something similar to Strategy. I made a video about it before, and the comments section exploded. One side said, "Yes, this thing is a ticking time bomb." The other side, the Bitcoin crowd, said, "Stevie, you're completely wrong. You need to talk to someone who really understands this business." Jeff, you took the initiative to come on. You're the Chief Risk Officer. In my video, I roughly said your setup is too crazy: using an 11.5% preferred stock to prop up a 13% preferred stock. How does that math even work out?

Jeff Walton: Let's address this point by point. First, let me briefly introduce myself to give everyone some context. I'm Jeff Walton, Chief Risk Officer at Strive. Before joining Strive, I was in the reinsurance industry. What is reinsurance? Simply put, it's "insurance for insurance companies." Insurance companies fear that one wildfire or one hurricane could bankrupt them. Reinsurance is the tool that helps them smooth out that volatility.

An insurance company is essentially a capital machine. On one hand, it manages capital; on the other, it manages the future claim obligations corresponding to that capital, earning returns by taking on risk. A few years ago, I left reinsurance and joined a Bitcoin company because, in my view, Bitcoin is the digital version of capital – more flexible and transparent than the forms of capital in traditional markets.

The SATA mentioned in your video is a perpetual preferred stock, yielding 13% annualized, with a floating interest rate. It has several sources of capital backing this monthly dividend obligation. An important data point: as of today, we have $1.2 billion in Bitcoin on our books and only $10 million in debt. That means our leverage is only 0.83%, practically negligible.

Coffeezilla: Wait, you didn't include the preferred stock in that leverage calculation, right? Equity isn't debt.

Jeff Walton: Correct, it's not included.

Coffeezilla: But you call it "digital credit," and that name itself is quite misleading.

This is one of my gripes with you – not personally, but with both you and Michael Saylor. You use very "debt-like" language to describe something that isn't debt. Part of the reason I made the video is this – objectively speaking, as long as the risk disclosure is adequate, you can sell it however you want. But by using vague marketing language, ordinary customers can't figure out what they're buying, and that's how many people get burned.

You call it "digital credit." Ordinary people hear "credit" and think it's debt. But you just said yourself, preferred stock is not debt. You have no obligation to return the customer's $100 principal investment.

Jeff Walton: Let's look at it from a different angle. What risk are you actually underwriting when you buy this thing? I have 0.83% debt on my books, less than 1%. The rest is all equity: $1.2 billion in Bitcoin, plus $12 million in cash. On the question of "can I afford to pay 13% annually?", what risk are you taking?

Coffeezilla: You take the risk of Bitcoin falling, the risk of you getting hacked, the risk of you issuing debt senior to this preferred stock in the future – a whole bunch of risks, all listed in your SEC filings.

Jeff Walton: Right. So what you're underwriting is credit risk: whether we can continuously pay that interest indefinitely, and the credit risk of the reserve assets on our balance sheet. That's why we call it "digital credit" – because what you're buying is essentially credit risk. It's not debt; there's no principal to repay.

Coffeezilla: But that's not how people in the market understand it. I've listened to quite a few of your and Michael Saylor's podcasts. You often compare this product to bonds, saying things like, "Look at how low bond yields are now." But bonds are a completely different thing. When you hold a bond to maturity, you get your principal back – depends on the specific type, of course, but if you buy US Treasuries, you generally get your principal back. Your product doesn't have that. Saylor even compares it to a bank account. It's not remotely a bank account. Your own disclosure documents explicitly state: "This is not a bank account or a money market fund." So why do you market it as akin to bonds and money markets?

Jeff Walton: I think it's fair to compare it to other credit instruments in the market. Look at perpetual preferred stocks issued by banks; those are the true peer comparisons. But I admit you don't see many comparisons out there. The credit risk of any instrument boils down to math. How do you calculate the credit risk of a Boeing bond? You look at the balance sheet, the cash flows, make an estimate of the company's future performance. That's it.

Coffeezilla: But the risk type and protection mechanisms are different for each instrument. You can't just brush it off with "it's all math."

Jeff Walton: What I'm saying is it's math. Institutional underwriters compare credit risk: what's the probability I'll get my money in the future? Any credit instrument requires solving this problem. One method is "can I get my principal back?" – that's the logic of traditional bonds. Preferred stock follows a different logic: how long do I need to hold it to recoup my invested principal through dividends? This is the instrument's "duration."

If you buy JP Morgan's 5% perpetual preferred stock, you need to hold it for 20 years to get your principal back through dividends. That's the credit risk you're taking. You don't need to worry too much about liquidity because it's perpetual; you're concerned with how long it takes to earn your money back. The logic of a perpetual instrument not returning principal is completely different from a traditional bond, but both are math.

Coffeezilla: That's where we disagree. I think calling it "digital credit" is misleading. Let's put that aside for now and talk about the actual credit risk of these things.

Let me be clear: I'm not saying either you or MicroStrategy will collapse tomorrow. My view is that it's a snowball that will slowly grow bigger. Liabilities keep piling up, eventually eroding you and MicroStrategy, trapping a lot of people. Because the more successful this product is, the heavier the overhang of liabilities becomes.

Jeff Walton: Then let's talk about the math. It is, at its core, a math problem.

Coffeezilla: But this is where it gets particularly difficult. Because Michael Saylor comes out and says, "If Bitcoin just goes up 2.5% a year, we can pay all our dividends indefinitely." He says this often. But that's calculated based on the current STRC issuance. The more STRC they issue, the higher the required Bitcoin appreciation rate becomes. This number is dynamic; you'd agree with that, right?

Jeff Walton: Not necessarily. If Bitcoin itself goes up, the balance sheet grows, and the relative proportion of liabilities gets diluted. They have 818,000 Bitcoins on their books. When Bitcoin's price rises, the book value increases, and the leverage ratio actually decreases.

Coffeezilla: True, the leverage ratio goes down. But the opposite also happens when it falls. That's my point.

And I think there's a flywheel effect here. You issue yield-bearing products to raise money, and then use that money to buy the asset that nominally backs the product. The act of buying itself pushes the asset's price higher, making it look even more stable.

But this flywheel also works in reverse. When you have to sell assets to pay dividends, it creates selling pressure on that asset. That's why the market reacted so strongly when Michael Saylor said, "We might have to sell Bitcoin to pay dividends."

I know you hate the term "Ponzi-like." But one core characteristic of a Ponzi scheme is quite simple: using money from new investors to pay returns to old investors. Let me give you an example: If MicroStrategy used money raised from new STRC issuances to pay STRC dividends, would you consider that Ponzi-like?

Jeff Walton: Cash is fungible. Where incoming cash comes from can be structured in various ways. The fundamental difference between a Ponzi scheme and our type of capital management vehicle is this: a Ponzi scheme has no reserves; we do.

Coffeezilla: But ultimately, aren't your reserves also just the money constantly coming in from investors? New money comes in, you stuff it into reserves, and use it to pay future dividends.

Jeff Walton: Ponzi schemes also have reserves.

Coffeezilla: No, they don't. Investor money doesn't go into any "reserve account"; it's paid directly to older investors.

Jeff Walton: They probably have some at the beginning, right?

Coffeezilla: Let me give you an analogy. Suppose I take $100 from you, promise you a 10% return forever, but I just sit on the money and do nothing with it. Now, I have $100 in "reserves" on my books, using this $100 to pay your interest. Eventually, the reserves will run out, and I'll have to bring in new funds. That's the problem with Ponzi schemes; they become a debt snowball.

I admit there's a fundamental difference between you and a Ponzi scheme: Ponzi schemes usually involve deception. If your risk disclosure is adequate and clients accept it, that's their business. But what I'm saying is that the structure has fragility similarities to a Ponzi scheme: unless Bitcoin goes up forever, it's unsustainable in the long run. And I think "Bitcoin goes up forever" is a terribly bad bet.

Jeff Walton: So is an insurance company a Ponzi scheme?

Coffeezilla: No, it's not.

Jeff Walton: Why not?

Coffeezilla: Because it has a real business that generates real cash flow. It sells risk.

Jeff Walton: Believe it or not, almost 100% of the claims an insurance company pays out come from the premiums it collects. According to your definition, an insurance company would also be a Ponzi scheme, right?

Coffeezilla: No, it's different. An insurance company has real profit and real cash flow generated from the assets it underwrites. A proper comparison would be this: an insurance company doesn't sell insurance, but instead issues a "yield product based on something." You ask "based on what?" and the answer is "based on our balance sheet." Where did the balance sheet come from? "By selling this yield product." That's analogous to you. A real insurance company sells a clear-cut product. I insure my car, I pay a premium.

Jeff Walton: Isn't a preferred stock a product? It's stock, a perpetual preferred stock. That is a product. Clients hold it for a reason.

Coffeezilla: They hold it because they think they'll receive dividends. That's not the product itself. Is Nvidia's stock the product?

Jeff Walton: Of course, it is.

Coffeezilla: No, Nvidia's GPU is the product.

Jeff Walton: Stock is a product. Clients use it for value storage. Our perpetual preferred stock is a product.

Coffeezilla: No. Is your insurance policy a product?

Jeff Walton: An insurance policy is a financial contract, a financial product designed to compensate you when you incur a loss. Our instrument is also a financial product. It's essentially a structured finance company. It's not that complicated.

Coffeezilla: The problem is that the sales story is too simple, but the underlying risks are very complex.

Jeff Walton: Let's talk about the Bitcoin market. One of your underlying assumptions is that Strategy is the only big player in the Bitcoin market. That's fundamentally incorrect. In the last 11 days, Strategy hasn't bought a single Bitcoin. Yet, in those 11 days, the Bitcoin market saw $350 billion in transaction volume, equivalent to 4.4 million Bitcoins. Strategy didn't even participate. This is a market with extremely deep global liquidity.

So, what's the magnitude of Strategy selling Bitcoin to pay monthly dividends? At a Bitcoin price of $80,000, they would need to sell 1,530 Bitcoins per month to cover the dividends. The market traded 4.4 million Bitcoins in 11 days. 1,530 Bitcoins is nothing for the market.

The liquidity of the underlying Bitcoin is always there. If needed, they can sell Bitcoin anytime to pay dividends. But in practice, the cost of capital from issuing equity is lower. They can issue common stock or perpetual preferred stock to pay dividends, and they also have operating cash flow.

Coffeezilla: What people find weird is this process: you sell STRC to buy Bitcoin, and then sell Bitcoin to pay STRC interest. I don't want to use the P-word again, but it looks like you're taking a non-yield-bearing reserve asset, packaging it, and selling it as a yield-bearing product.

Jeff Walton: