Peter Schiff Warns Strategy's New Bitcoin Program Could Trigger a Dangerous Sell-Off Loop

Veteran crypto critic and financial commentator Peter Schiff has raised serious concerns about Strategy's newly unveiled "BTC Monetization Program," suggesting the initiative could set off a self-reinforcing downward spiral in Bitcoin's price.

Schiff argues that as Bitcoin's value declines, Strategy — the largest corporate holder of BTC by a wide margin — will be compelled to sell increasing amounts of its holdings, which in turn would push prices even lower, creating a feedback loop with potentially devastating consequences for the broader crypto market.

Strategy recently disclosed through an official press release that it has already begun liquidating portions of its substantial Bitcoin reserves. The monetization framework, as outlined by the Virginia-headquartered company, allows it to convert BTC into U.S. dollars for three distinct purposes: building up to $1.25 billion in fiat cash reserves, covering preferred dividends and debt interest obligations, and funding up to $1 billion in Digital Credit Securities repurchases alongside another $1 billion in Class A common stock buybacks — totaling a $3.25 billion capital runway.

Schiff wasted no time in voicing his alarm on X, formerly known as Twitter. "MSTR is now a Bitcoin seller," he wrote bluntly, laying out the full scope of the program. He further calculated that at the current Bitcoin price hovering near the psychologically significant $60,000 level, the authorized $3.25 billion in potential sales would translate to more than 54,000 BTC entering the market. "If Saylor crushed Bitcoin when he announced the sale of just 32 Bitcoin, imagine the impact of today's announcement," Schiff added pointedly.

The announcement comes at a particularly turbulent moment for STRC, Strategy's proprietary financial instrument, which has recently collapsed well below the $100 mark. In response to mounting pressure, Strategy declared it would raise the STRC regular dividend rate to 12.00% per annum, effective July 1 — a significant jump designed to shore up investor confidence.

Despite the alarming optics, Strategy's CFO Andrew Kang moved quickly to reassure the market, emphasizing that the company is not operating as a forced seller. He noted that Strategy currently maintains approximately $2.55 billion in USD reserves, providing a substantial liquidity cushion.

The central question now facing the crypto market is whether it can withstand the psychological pressure of a potential 54,000 BTC liquidation threat looming overhead. As of the time of writing, Bitcoin has managed to hold its ground and remains in positive territory — but the market is watching closely.

Schiff's warning serves as a stark reminder that Strategy's transition from an aggressive Bitcoin accumulator to a potential large-scale seller represents a fundamental shift in market dynamics. Whether this pivot marks the beginning of a broader confidence crisis or simply a strategic financial adjustment remains to be seen, but the stakes for the entire cryptocurrency ecosystem are undeniably high.