Benchmark analyst Mark Palmer stated that interpreting Strategy’s STRC model as a “circular financing or Ponzi scheme” is a “serious misreading,” calling it an “intentionally designed and sustainable capital framework.” According to Strategy’s SEC 8-K filing, the company raised approximately $35 billion in the first three weeks of April, with over 85% coming from STRC issuances, and subsequently purchased a total of 51,400 bitcoins over the following three weeks, valued at approximately $3.9 billion. Strategy’s current Bitcoin holdings have increased to 818,300 BTC, with a market value of about $62.5 billion, and it has returned to a roughly $700 million unrealized gain. Benchmark believes this structure does not rely on continuous issuance and can pay preferred dividends by selling Bitcoin if necessary, though the market remains skeptical of its potential risks.
Benchmark Analyst Defends STRC Model as a Sustainable Capital Framework
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Summary
Benchmark analyst Mark Palmer defends Strategy’s STRC model as a sustainable capital framework, not a Ponzi scheme. In early April, Strategy raised $3.5 billion, with 85% coming from STRC issuance, and used the funds to purchase 51,400 Bitcoin. The firm now holds 818,300 BTC, valued at $62.5 billion, with $700 million in profits. Benchmark states that the model supports value investing in crypto and provides capital protection through Bitcoin sales if necessary. Market concerns about risks persist.
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