Billionaire Michael Saylor has been in tight spots before but nothing like this. The share price of Saylor’s firm, Strategy, which owns over 3% of the world’s Bitcoin, is down dramatically. Worse, the company faces twin headwinds in the form of a bearish crypto market and an impending rule change that will likely trigger a mass selloff of its stock. On Monday, the company announced a $1.2 billion reserve fund to meet impending interest and dividend obligations, but that did little to prop up its shares. All of this fueled fresh attacks from Saylor’s critics who say Strategy’s unusual business model, which revolves around selling stock to buy Bitcoin, is unsustainable or even a Ponzi scheme.
Saylor has ridden out storms in the past. That includes an accounting scandal in 2000 that almost sank one of his previous companies and saw him lose $6 billion of his personal fortune in a day. Saylor’s defenders, meanwhile, dismiss critics as knee-jerk Bitcoin detractors who don’t understand the currency or the corporate finance techniques underlying Strategy’s operations.
