Ripple CEO Brad Garlinghouse criticized Strategy’s Bitcoin accumulation model, saying crypto’s long-term value depends on utility instead of financial engineering. Ripple CEO Brad Garlinghouse has criticized Strategy Chairman Michael Saylor’s approach to buying Bitcoin. During a CNBC interview, Garlinghouse said long-term value in digital assets should come from real-world utility. However, he argued that financial engineering alone cannot create lasting value for the crypto market. Garlinghouse Criticizes Strategy’s Bitcoin Funding Model Garlinghouse stated that Strategy has been too dependent on financial products to buy more bitcoins. This approach is more about fundraising than value creation via blockchain technology, he said. Hence, he thinks the strategy has been detrimental to the entire crypto market. Related Reading: Strategy May Pause Bitcoin Buys, CryptoQuant Says  Meanwhile, Garlinghouse has reiterated his support for Bitcoin. He also expressed his bullishness on the world’s largest cryptocurrency despite criticizing Strategy’s business model. Rather, he said, digital assets should expand as people use them in real applications. He made his remarks when Bitcoin was trading at less than $60,000. Investors, meanwhile, were keeping a close eye on the wider crypto market, which has been on a downward trend for several weeks. Consequently, the focus also turned to businesses that had massive amounts of Bitcoin. Another issue is Strategy’s STRC preferred shares, Garlinghouse said. The shares have recently traded at around $74.57, approximately 25% below their liquidation preference of $100. Moreover, STRC has a 11.5% annual cumulative dividend and has assisted Strategy in raising funds for more Bitcoin purchases. According to Garlinghouse, these numbers show the limits of relying on financial engineering. Therefore, he said long-term crypto success should depend on technology, adoption, and practical use rather than complex funding methods. Strategy Faces Growing Market Pressure One of the world’s biggest corporate Bitcoin treasuries is currently held by Strategy. But, in recent market weakness, the value of those holdings has been diminished. The company now has an unrealized paper loss of over $13 billion. The company’s average price to buy a bitcoin is approximately $75,600. Since Bitcoin is trading below that level, Strategy’s holdings are worth less than the amount it paid. But these losses are not realized as the company has not sold its Bitcoin. Paper loss only represents the market value of an asset at the time of the loss. Therefore, it becomes a real loss only if the company decides to sell those holdings at lower prices. Meanwhile, Strategy market indicators have also weakened. As of the June 26 U.S. market close, the company’s mNAV stood at 0.99. This implies Strategy’s enterprise value had dropped below the market value of its Bitcoin holdings. The company’s management had earlier stated that an mNAV of approximately 1.22 is the minimum required to issue new shares to be beneficial for shareholders. Since the current figure is below that level, management has previously suggested that selling some Bitcoin, rebuilding cash reserves, or repurchasing company shares could become better options than issuing additional stock. Although Garlinghouse questioned Strategy’s funding model, he repeated that he remains optimistic about Bitcoin’s future. He stated that digital assets’ long-term success will rely on their actual utility, increasing adoption, and robust technology, not just financial engineering.   The post Ripple CEO Questions Strategy’s Massive Bitcoin Accumulation appeared first on Live Bitcoin News.

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