Strategy, which is the $64 billion bitcoin treasury company led by Michael Saylor, has one overriding objective: acquire as much bitcoin as possible as quickly as possible. However, the firm posted 11-figure losses for the second quarter running, as the bitcoin price currently sits well below the all-time high of $125,000 reached in October of last year. Still, Strategy has continually lined up new funding sources that have allowed it to keep buying bitcoin in 2026.
In its 2026 first-quarter earnings report released on Tuesday, Strategy reported a net loss of $12.54 billion, which followed $17.44 billion in losses for the final quarter of 2025. The overwhelming share of those figures consists of unrealized declines associated with bitcoin’s lower price. The company has never sold any of the bitcoin it has acquired; however, it looks increasingly open to that eventual possibility. Its stash now stands at 818,334, or roughly 3.9% of the entire bitcoin supply. These holdings currently carry a market value of $64.14 billion with the bitcoin price around $78,000.
Despite the large unrealized losses showing up on paper, the company that invented the corporate bitcoin treasury model used the earnings release to highlight the performance of its digital credit instrument called Stretch, or STRC. Stretch is Strategy’s Variable Rate Series A Perpetual Stretch Preferred Stock. Investors buy shares of this preferred equity product, and the company channels the proceeds straight into bitcoin purchases. Holders receive variable-rate dividends supported by the firm’s bitcoin holdings, which the company and its supporters expect to rise substantially over time. The instrument has attracted $5.58 billion year to date and more than $8 billion in the nine months since it originally launched.
To put it more simply, Strategy is basically borrowing money at 11% per year (at current rates) and using it to buy bitcoin because they think the price of the crypto asset will increase by more than 11% per year. The company is effectively a levered play on bitcoin. That said, previous funding mechanisms involved much lower costs of the borrowed capital.
“Strategy is the dominant issuer of Digital Credit in the world, with over $13.5 billion of preferred equity outstanding, supported by a fortress Bitcoin balance sheet,” said Strategy CFO Andrew Kang. “We continue to extend our track record of servicing our dividends, having now met our payment obligations on time and in full across 23 consecutive distributions, totaling over $693 million since the launch of our preferred equity products in early 2025.”
While the unrealized losses have drawn scrutiny, Strategy keeps its attention on lifting bitcoin holdings per share rather than chasing dollar-denominated quarterly profits. The company measures success through metrics such as BTC yield, which reached 9.4% in the first four months of 2026, and it added about 63,410 bitcoin to its treasury during that stretch. Executives believe bitcoin will keep expanding its role as a global, apolitical reserve asset and therefore rise in value over time.
Strategy CEO @phongle refuted my claim that $STRC is a Ponzi scheme by arguing it’s “transparent” and “very clear what we’re doing.” But I never accused Strategy of hiding the scheme. In contrast, I called STRC the most obvious Ponzi precisely because $MSTR is so open about it.
— Peter Schiff (@PeterSchiff) May 3, 2026
Critics of Strategy’s overall approach are not hard to find, and some describe it as an outright Ponzi scheme. Peter Schiff, the veteran gold advocate and bitcoin skeptic who heads Euro Pacific Capital and predicted the 2008 housing crisis, has called Strategy’s STRC product “the most obvious Ponzi scheme.” He also noted that the company being completely transparent about what it’s doing does not mean it isn’t a Ponzi scheme.
Strategy has also been compared to the investment trusts that gained popularity during the 1920s stock market boom and eventually contributed to the 1929 collapse. Those vehicles used substantial leverage to load up on shares of emerging technology companies. The analogy has appeared often since the release of Andrew Ross Sorkin’s recent book 1929, which details the events leading to that crash. That said, Sorkin himself has avoided claiming that Strategy faces the same kind of devastating outcome.
Whether the model holds up through the next crypto cycle or collapses in a Ponzi-esque manner remains an open question, but for now investors keep supplying the capital that lets Strategy keep adding to its bitcoin hoard.