New Bitcoin purchases weigh on Strategy preferred shares

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STRC drops below target

Highlights

STRC fell 3.58% to $91.79, below its $100 target value.
Strategy bought 1,587 BTC last week for about $100 million.
Investors are questioning whether cash should support dividends instead.

STRC falls below target value

Strategy’s variable-rate perpetual preferred stock, known as STRC or Stretch, fell 3.58% to $91.79. That put it 8.2% below its $100 target value and near one of its lowest closes since trading began, Cointelegraph reports.

Stretch is designed to trade around $100 and pay an 11.5% dividend. But after the selloff, its effective yield rose to about 12.5%, reflecting the market’s demand for a higher return to hold the security.

Markus Thielen, chief executive of 10x Research, said investors appear to prefer that Strategy keep more cash available for dividend payments rather than continue buying Bitcoin. In his view, traders are treating the latest BTC purchases as a sign that the STRC model may be under pressure.

Bitcoin purchases remain central to Strategy

The selloff followed Strategy’s disclosure that it bought another 1,587 Bitcoin for about $100 million last week. A week earlier, it purchased 1,550 BTC for a similar amount. The latest acquisition brought Strategy’s total holdings to 846,842 Bitcoin, keeping it the largest public corporate holder of the asset.

That scale is central to the company’s identity, but it also increases pressure on the securities used to finance the strategy. Strategy has relied on common stock and preferred shares to raise capital for Bitcoin purchases while offering income-focused investors products such as STRC.

Nick Ruck, director of LVRG Research, said broader risk-off sentiment in crypto markets has reduced investor appetite. He added that persistent selling pressure and concerns over Strategy’s expanding capital structure and at-the-market issuance are testing STRC’s ability to remain close to par.

A pressure test for Bitcoin-backed income

The move matters because STRC is meant to show that Bitcoin-backed finance can serve income investors, not only equity buyers willing to absorb large swings. If STRC keeps trading well below par, Strategy may face higher funding costs and more pressure to prove that its dividend structure is sustainable.

Competition is also increasing. Strive’s variable-rate preferred shares, SATA, are trading around $100 and offering an effective yield near 13%, giving income investors another option.

Strategy’s common stock is under pressure as well. MSTR fell 6.35% on Tuesday to $122.81 and is down sharply over the past year. That leaves Strategy balancing three demands at once: maintaining its Bitcoin buying strategy, supporting preferred dividends and reassuring investors that its capital structure can withstand weaker crypto markets.

Earlier, we reported that Strategy accumulates nearly 4% of Bitcoin supply with strong 2026 gains.

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