Strategy's perpetual preferred security, Stretch (STRC), dipped to $97.11 on Thursday as Bitcoin slipped to the $73,000 mark. The security typically faces selling pressure during Bitcoin drawdowns and in the days following its ex-dividend date, as seen on Nov. 20 and Feb. 5.
Ex-Dividend Effect and Bitcoin Weakness
The ex-dividend adjustment reflects the value of the dividend, while Bitcoin weakness curbs demand for Strategy-linked securities. Together, these factors historically compress STRC's market price. The company structured STRC to trade near its $100 par value, as maintaining that level enables continued issuance through its at-the-market (ATM) program for capital raising.
Cash Reserve Halved After Buyback
Strategy recently repurchased $1.5 billion of its 0% convertible senior notes due 2029, reducing debt but draining cash. The cash balance dropped from roughly $2.25 billion to $871 million. With annual preferred dividend obligations of about $1.7 billion, the remaining cash now covers only roughly six months—down from the original 24-month buffer.
Saylor's Three-Pronged Capital Plan
Executive Chairman Michael Saylor outlined potential capital sources: selling Bitcoin, issuing MSTR equity when the stock trades above a 1.22x multiple to net asset value, or raising funds via STRC issuance. All decisions are evaluated on a Bitcoin-per-share basis, prioritizing accretive moves for shareholders.
Strive's Daily Dividend Gambit
Rival bitcoin treasury firm Strive Asset Management (ASST) has taken a different approach. Its perpetual preferred security SATA, which announced daily dividend payments (not yet live), remains tightly anchored near $100 par while offering a ~13% dividend yield—even during Bitcoin's decline. The daily dividend mechanism is seen as a stabilizing feature. Strive also eliminated all debt inherited from the Semler Scientific acquisition, mirroring Strategy's deleveraging direction.