Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management, said gold remains more practical than Bitcoin for everyday use, reigniting the debate over Bitcoin’s utility as a real-world payment asset.
Gerber also criticized Michael Saylor’s Strategy Inc. (NASDAQ: MSTR), warning that the company’s leveraged Bitcoin accumulation strategy could cause a major Bitcoin selloff if the structure eventually comes under pressure. His comments were included in a note shared with Benzinga.
Gerber’s argument is based on gold’s physical usability, noting that the precious metal can be exchanged in more real-world settings around the globe than Bitcoin, despite years of industry efforts to promote the cryptocurrency as a payment method.
Trader Scott Melker disputed that view, noting that Visa and Mastercard cards connected to crypto accounts allow Bitcoin holders to spend their assets at virtually any merchant that accepts card payments.
However, such transactions typically rely on payment intermediaries that convert Bitcoin into fiat at checkout. As a result, merchants using these systems may never directly receive BTC through an onchain transaction.
Gerber’s main criticism focuses on Strategy’s practice of issuing equity to finance additional Bitcoin purchases. He questioned whether investors benefit from buying shares when the company trades at a premium to the value of its underlying Bitcoin holdings. Strategy’s stock is trading at roughly 1.61 times the value of its BTC reserves.
He argued that selling shares at an elevated valuation to acquire Bitcoin creates an unfavorable equation for shareholders, essentially asking why an investor would pay $200 for exposure to $100 worth of Bitcoin.
Gerber further warned that a major Bitcoin correction could put Strategy’s leveraged structure under strain and potentially force the company to sell BTC. He said such a liquidation event could have severe consequences for the broader Bitcoin market.
Strategy has maintained that its growing use of perpetual preferred securities, which have no fixed maturity date, reduces the possibility of forced selling even during an extreme 80% decline in Bitcoin.
Strategy reported holding 629,376 BTC worth more than $72 billion in its latest disclosure after adding another 430 BTC for approximately $51.4 million. However, the company’s shares have trailed Bitcoin’s performance over the same period.
Bitcoin miners increasingly turn to AI
Gerber also questioned whether Bitcoin’s mining infrastructure could weaken as large mining companies shift resources toward AI and high-performance computing.
The transition is already visible across the industry, with several publicly traded miners converting existing facilities into AI data centers and signing hosting agreements. Riot Platforms’ recent AI leasing deal is one example of this shift.
Core Scientific has also been converting a 300-megawatt Texas site that previously supported Bitcoin mining into an AI data-center campus. Revenue from its colocation business has already surpassed income from its self-operated Bitcoin mining activities.
CoinShares projections cited in industry reports indicate that for miners with significant AI contracts, Bitcoin mining could decline from around 85% of total revenue in early 2025 to below 20% by the end of 2026.
The growing move toward AI infrastructure does not mean Bitcoin mining is disappearing. Instead, it suggests that the economics of large-scale computing are increasingly favoring AI hosting over traditional mining operations. While this trend supports some of Gerber’s concerns, it does not establish that AI-driven mining conversions have permanently limited Bitcoin’s long-term potential.
