- Schiff links STRC’s discount to weaker Wall Street confidence in Bitcoin targets today.
- Parker sees STRC beating Bitcoin if dividends hold and shares return to par soon enough.
- Strategy may avoid Bitcoin sales, though buybacks could still reduce cash reserves.
Economist and market commentator Peter Schiff has challenged Wall Street’s confidence in Bitcoin. He pointed to STRC’s market price as evidence. Schiff said bullish BTC targets do not match STRC’s discount, which he believes reflects dividend-cut risk.
In an X post, he said Wall Street is not putting its money where its mouth is. In his view, banks do not appear to believe Bitcoin can rise even 12% per year.
STRC Upside Challenges Bitcoin Returns
According to Schiff, STRC would likely trade near $100 if that confidence existed. Instead, it remains below $87. He said the current price shows the market is pricing in meaningful risk of a dividend cut.
However, analysts see a stronger upside case for STRC if the dividend remains unchanged and the security returns to par. Analyst Parker highlighted that upside case using three assumptions.
The analysis placed STRC at $86, its annual dividend at $12, and Bitcoin at $62,000. At that STRC price, the dividend yield stands at 13.95%.
Parker said a move from $86 to par value would create a 16.28% price gain. When combined with the $12 dividend, the total one-year return would reach 30.23%.
Based on Bitcoin’s price of $62,000, Parker calculated that BTC would need to rise to $80,744 within one year to match STRC’s raw return. The analyst then adjusted the comparison for volatility.
Parker said STRC is unlikely to move as sharply as BTC, especially once recent market swings settle. The analyst said BTC would need to reach $99,488 within one year to match STRC’s risk-adjusted return, based on an average 0.5 beta to Bitcoin.
According to the analyst if STRC returned to par within three months, Bitcoin would need to climb to $74,256 to match the raw gain. On a risk-adjusted basis, BTC would need to reach $86,512 in the same period.
Strategy Faces Buyback and Reserve Pressure
Parker framed the issue around probability. The analyst compared Bitcoin reaching $86,512 in three months with STRC returning to par. Parker also noted that if BTC falls further, STRC may decline less while still earning its dividend.
However, Market commentator FinancialFreedom said Strategy’s best move may be no move. The company holds nearly 900,000 Bitcoin and has cash on its balance sheet. It has also addressed market concerns about STRC liquidity.
He said selling more BTC after a drawdown could weaken Strategy’s long-term position. FinancialFreedom compared that move to a real estate investor selling properties at a 15% loss to raise cash that is not urgently needed.
In his view, Bitcoin gains over the next 12 months could improve Strategy’s balance sheet without forced selling. A stronger BTC price could also give the company better financing options.
However, in an X post, analyst Grain of Salt said Strategy may still need to sell BTC to support buyback programs. The company could use cash above its 12-month mandate, but that would reduce its reserve buffer.
STRC’s discount has now become a key signal for investors. Bulls see a possible return opportunity if the dividend remains secure. Cautious observers see the price gap as a warning about dividend risk and pressure on Bitcoin-linked financing plans.
Related: Nakamoto Consensus vs One Node One Vote: Adam Back Declares Bitcoin Is Self-Sovereignty
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