“PAID BY SELLING MORE SHARES OF STRC” — SCHIFF NAMED THE MECHANISM IN APRIL — SIX STRAIGHT FILINGS SHOW NOT ONE SHARE SOLD SINCE JULY, AND THE DIVIDEND WENT UP

In April, Peter Schiff told an X Space how the fraud worked. “The 11.5% yield on STRC is paid by selling more shares of STRC, and then you get money from new investors to pay old investors.” In May he sharpened it: bitcoin was a “decentralized Ponzi,” but STRC was “a classic centralized Ponzi run by $MSTR.” That made it testable. Then the machine stopped. STRC broke its $100 stated value on June 18 and has not been back. Strategy's policy is not to issue it below par, and the filings show it held. The amount available for issuance has sat at $17,510.8 million, unchanged to the dollar, across six straight weekly reports from July 20 to August 30. Not one new share sold. The dividend went up anyway. It was 11.5% when he said it. It is 12% now, never once cut. The shares traded at $71.25 in June and $97.34 on Tuesday. And the man Schiff accused of defrauding investors put $998,756 of his own money into 11,000 shares on June 22. The only stock he sold in June was common, and it went to taxes under a plan he signed two years earlier. He bought four days before the low, and he still owns every share. Now the part we won't dress up. Strategy paid those dividends by selling bitcoin it owned and diluting its own common holders. That is expensive and worth arguing about. It is also the one thing a Ponzi can never do, because a Ponzi has nothing to sell.