Schwab's Strategy Defends Bitcoin Playbook Amid Market Slump

Schwab's Strategy has faced criticism for its handling of Bitcoin during the cryptocurrency's recent slump, but the firm's director of crypto research and strategy, Jim Ferraioli, is defending their approach.

The company, led by Michael Saylor, has funded much of its buying through preferred equity, including its variable-rate Stretch preferred stock, STRC. When STRC fell to near $70 from its par value of $100, Strategy raised the dividend to 12% and authorized $2 billion in buybacks while unlocking further Bitcoin sales.

This move has had a positive effect on the stock, which is now climbing back toward par. Ferraioli said that 'the market is supportive' of these actions and that they have provided a check on fears of cascading liquidations.