MicroStrategy has reportedly boosted its USD reserve by $748 million, bringing its total cash holdings to $2.19 billion, alongside a Bitcoin portfolio of 671,268 BTC.
The move reflects the company’s continued strategy of maintaining significant liquidity while doubling down on cryptocurrency exposure, even as the market navigates a prolonged Bitcoin bear phase.
The move, funded via recent capital raises like convertible notes, provides liquidity for opportunistic BTC buys during market volatility, countering insolvency concerns raised by critics. However, this aggressive approach has sparked debate among investors, with some questioning the risks of combining large cash reserves with heavy Bitcoin holdings.
Renowned gold advocate and economist Peter Schiff has once again taken a jab at Michael Saylor and his company, Strategy, interpreting the cash buildup as a sign of panic for the bear market.
He wrote on X,
“It seems to me that you are building dollar reserves as you realize you will soon need them.”
He argued that with expected Fed rate cuts and quantitative easing likely to fuel inflation, holding USD is risky and suggested Strategy should follow Tether’s lead by building gold reserves instead.
Tether, the issuer of the world’s largest stablecoin USDT, has indeed been aggressively accumulating physical gold. In Q3 2025 alone, it purchased 26 tonnes, pushing its total holdings to 116 tonnes, enough to rank it among the top 30 global gold holders if compared to central banks.
Meanwhile, sources indicate Strategy’s cash reserve is primarily designed for liquidity, to cover preferred stock dividends (currently funded for over 32 months) and debt obligations without forcing Bitcoin sales during volatility. With Bitcoin trading around $90,000 amid a 2025 market pullback, this move is seen by some as prudent risk management rather than a lack of faith in BTC.
Schiff advocates gold over USD reserves as a superior inflation hedge. His criticism at Strategy, highlights his long-standing view that gold is the superior inflation hedge and store of value, especially in uncertain economic times.
He claims Bitcoin has lost 46% of its value in gold terms since its November 2021 peak, verified by historical data showing BTC at $69,000 against gold at $1,800/oz then, versus current levels of BTC at $87,400 and gold near $4,490/oz yielding a ratio drop from 38 to 19 ounces.
Schiff forecasts worsening BTC-gold dynamics over the next four years, reflecting his view of gold’s intrinsic scarcity versus Bitcoin’s speculative nature, supported by gold’s historical resilience in crises per Federal Reserve studies on safe-haven assets.
The gold advocate and Bitcoin skeptic, argues in the post that Bitcoin remains correlated with risk assets like stocks, amplifying downside moves while underperforming upside rallies, unlike gold’s independent strength.
He wrote,
“I don’t believe Bitcoin has decoupled from other risk assets. It just doesn’t rally as much when they rise, and it declines much more when they fall. What should be obvious by now is that it’s not digital gold. If gold goes way up, there is no reason to expect Bitcoin to follow.”
In 2025, Bitcoin surged to a $126,000 peak in October before dropping over 30% amid market volatility, while gold advanced 55% year-to-date to new highs, driven by central bank demand and geopolitical tensions.
Recent analyses show Bitcoin’s one-month correlation with the S&P 500 has stayed positive above zero for most of 2025, supporting Schiff’s view, though some data indicate a gradual decline in ties to both equities and gold since 2020.
However, ritics of Schiff point out his repeated and often incorrect predictions of gold surges over the past decade, while Bitcoin has delivered massive returns for holders like Strategy.
Around 2008–2009, he predicted gold to reach $2,000 by 2009 and $5,000 by 2013 (gold peaked near $1,900 in 2011 but did not hit those targets on schedule).
His repeated bullish calls amid post-2008 QE and low inflation, yet gold traded sideways or lower for much of the decade (e.g., dipping below $1,300 as late as 2019).
These predictions often proved premature and incorrect in timing. Gold did not experience the explosive, sustained surge Schiff anticipated until the 2020s, particularly accelerating in 2024–2025 amid geopolitical tensions, central bank buying, and inflation concerns.
The point raised by critics is one of opportunity cost and timing. For much of the 2010s and early 2020s, Schiff’s urgent calls for imminent gold surges led investors to miss Bitcoin’s historic rally (and often stock market gains), while gold underperformed. His predictions were directionally correct long-term but repeatedly wrong on near-term execution, costing followers potential massive returns elsewhere.
Schiff remains unapologetic, dismissing Bitcoin as worthless and insisting gold’s physical utility and history make it superior. As of December 2025, with gold at record highs, his latest bullishness appears vindicated in the short run but the decade-long contrast with Bitcoin’s performance underscores the critics’ argument.
Outlook
Looking ahead, MicroStrategy’s dual strategy of holding substantial USD liquidity while maintaining a significant Bitcoin position positions the company to capitalize on market volatility without being forced into distressed BTC sales.
Analysts suggest that this approach could allow the firm to selectively accumulate Bitcoin at attractive levels during dips, potentially amplifying long-term returns if the cryptocurrency recovers or enters another bullish cycle.
Ultimately, the next 12–24 months may prove pivotal in evaluating the merits of MicroStrategy’s approach. Success could cement Bitcoin’s role as a strategic corporate asset, while significant drawdowns could embolden critics who argue for more traditional hedges like gold.
