ChainCatcher, citing CoinDesk, reported that STRC, the dividend-paying preferred stock issued by Bitcoin treasury company Strategy, recently traded below its $100 par value. The decline has prompted discussion around Strategy’s capital structure, its dollar cash reserves, and the company’s capacity to support dividend payments. The move in STRC came during a period when Bitcoin was under pressure, competing yield products were becoming more aggressive, and Strategy was making several adjustments to its funding arrangements.
Pressure Built Around the Ex-Dividend Date
On May 14, STRC closed at $100 ahead of its ex-dividend date. At that time, Bitcoin was still trading above $80,000, but pressure had already appeared in the market. During the same period, Strive Asset Management announced that its competing product, SATA, would adopt a daily dividend mechanism and raise its yield to 13%. That change added direct competition for STRC in both payout frequency and yield level, giving investors another product to compare against Strategy’s preferred stock.
On May 15, Strategy announced that it would repurchase $1.5 billion of 2029 convertible bonds at an approximate 8% discount. After the announcement, attention turned to the company’s dollar cash reserves, because those funds had been used to support dividends and debt-related obligations. For a dividend-paying preferred stock, the size and durability of cash reserves are closely tied to perceptions of payment stability. As a result, the bond repurchase became a key point in the repricing of STRC.
Dividend Coverage Fell From a 24-Month Target to About Six Months
On May 26, Strategy confirmed that its cash reserves had been used in the bond repurchase. The company’s reserves fell to approximately $871 million, a level equal to around six months of STRC dividend payments. This represented a sharp change from Strategy’s earlier target of maintaining about 24 months of coverage. The reduced coverage period led investors to reassess the funding base behind STRC, the company’s balance-sheet structure, and the degree to which its preferred dividend depended on available cash.
On June 1, Strategy sold Bitcoin for the first time since 2022, disposing of 32 BTC. The sale was presented as a way to demonstrate that the company had the ability to support dividend payments by selling assets. After the news was released, MSTR shares fell 5.9%. The transaction also gave the market another point of reference for how Strategy was balancing its Bitcoin holdings, dollar reserves, debt obligations and preferred-stock dividends.
STRC Hit a New Low After Bitcoin Dropped Below $60,000
On June 5, Bitcoin fell below $60,000, while STRC declined to around $90. On June 8, Strategy shareholders approved a change that would allow STRC to pay dividends twice per month, and the company disclosed that its dollar reserves had recovered to $1 billion. On June 15, Strategy bought another 1,587 BTC, while its dollar reserves rose to $1.1 billion. These events showed that Strategy continued to adjust across several fronts: dividend scheduling, cash reserves and Bitcoin holdings.
On June 18, STRC fell below $83 intraday, trading about 17% below its target price and reaching its lowest level since its July 2025 listing. It later closed at $88.59. The analysis cited in the report said the central challenge for STRC is that its high-yield preferred-stock structure is closely tied to the Bitcoin cycle. In a Bitcoin bear-market environment, investors are reassessing not only BTC itself but also the financial products and capital structures built around Bitcoin.