Ripple CEO Brad Garlinghouse says Michael Saylor's Bitcoin strategy is focused on the wrong priorities.
Garlinghouse said financial engineering cannot create long-term crypto value, only real-world utility can.
Garlinghouse points to STRC shares trading 25% below par as evidence that the model is under stress.
Ripple CEO Brad Garlinghouse has openly challenged Strategy Chairman Michael Saylor’s Bitcoin buying model, stating that financial engineering cannot replace real-world utility.
His comments come while Strategy continues to accumulate more bitcoin, even when Bitcoin continues to fall close to $58,000.
Ripple CEO Says Saylor Is Focusing on the Wrong Strategy
Speaking in a recent CNBC interview, Garlinghouse said that crypto companies should focus on building products people actually use instead of relying on financial engineering to boost Bitcoin holdings.
“Financial engineering does not drive long-term value.” “The long-term value of any digital asset is going to be driven by utility.”
According to Garlinghouse, assets that provide real-world use naturally attract demand, liquidity, and trust over time. Simply borrowing more money to buy additional Bitcoin does not create lasting value.
He also took direct aim at Michael Saylor’s approach, saying that
“Team Michael Saylor wasn’t focused on the right stuff, and that has hurt the overall market.”
He said this type of financial engineering may generate short-term excitement, but it does little to create lasting value for the crypto industry.
Leverage Is Making Bitcoin Drops Worse
Further, in an interview, Garlinghouse said that the strategy saw gains during Bitcoin’s rally, and it is now creating even more pressure during the market crash.
“I think because they were using leverage… You start to see that in a place that can actually compound negatively.”
He specifically pointed to Strategy’s STRC preferred shares, which now trade roughly 25% below their $100 par value, calling it “a pretty damning indictment.”
He described Bitcoin as “digital gold,” noting that transferring $300 billion worth of Bitcoin can be completed far faster and more efficiently than moving the same value in physical gold.
Ripple Pushes Institutional Blockchain Adoption
While praising Bitcoin’s role as digital gold, Garlinghouse pointed out Ripple’s different strategy. He said Ripple is focused on bringing traditional finance onto blockchain through XRP-powered payment infrastructure.
According to Garlinghouse, Ripple processed nearly $16 trillion in payment and prime brokerage volume last year through its expanding financial network.
As of now, Ripple’s XRP is trading around $1.05, seeing a jump of 2.5% in the last 24 hours.