An overnight crash in the price of bitcoin combined with a difficult to digest capital raise to send Strategy (MSTR) shares tumbling 12.5% to their weakest level in nearly 15 months in U.S. morning trading on Monday.

And yet, despite no bounce in the price of bitcoin BTC$86,378.70 — which remained near session lows of about $85,000 for the entire day — MSTR managed to nearly erase all of its losses, finishing lower by "just" 3.25%.

Until proven otherwise, the action appears to be no more than short-covering by fully satiated bears. At Strategy's weakest level on Monday of $155.61, the stock was lower by nearly 40% over just the past month and 66% from its 2025 high hit in mid-July. Any bears not covering their shorts at that point are surely in the wrong business.

King dollar

Facing pressure from critics and investors about Strategy's ability to fund preferred share dividends, Michael Saylor and team early Monday announced the company had spent the past couple of weeks selling common stock to raise a $1.44 billion reserve with which to pay preferred dividends for the next 21 months. The company's goal is to eventually have enough cash in reserve to pay dividends for a minimum of 24 months.

It was a startling turnaround for the pre-eminent bitcoin treasury company, but plunging bitcoin prices combined with a crash in the company's market valuation relative to its bitcoin holdings likely left it no other choice if it didn't want to start liquidating its massive BTC stack (650,000 coins at last check).

None too pleased at the potential dilutive effects of this new strategy, investors in the common stock sold heavily on the news, sending MSTR lower by about 12.5% in Monday action.

No-coiner and gold bug Peter Schiff took the news as an opportunity to pile on.

"So Strategy's new business model is to sell stock to raise cash, then use that cash to buy Treasuries that yield about 4% to fund the issuance of debt and preferred stock at a cost of 8%–10%," he said. "How much longer will investors pretend this is a viable business just to gamble on Bitcoin?"

"Today is the beginning of the end of Strategy," continued Schiff. "Saylor was forced to sell stock not to buy Bitcoin, but to buy U.S. dollars merely to fund Strategy's interest and dividend obligations. The stock is broken. The business model is a fraud, and Michael Saylor is the biggest con man on Wall Street."

Whether or not today's reversal marks a bottom for the struggling shares of Strategy remains to be seen. Battered Strategy (and bitcoin) bulls, however, might take some solace from the dozens of other times Peter Schiff has taken a victory lap amid the sector's difficulties, only to see the situation reverse completely with weeks or months.