Strategy's flagship funding vehicle, the Stretch preferred stock (STRC), hit an all-time low of $82.53 on June 22, closing at $88.59 — nearly 12% below its $100 par value. The preferred stock, launched in late July 2025, was designed to trade close to its face value, enabling Strategy to raise capital for continuous bitcoin purchases. Less than a year later, bitcoin has dropped from around $92,000 at STRC's launch to about $64,000, a decline of over 40%.
Discount Root Cause: Bitcoin Below Cost Basis
The discount on STRC reflects a straightforward chain: falling bitcoin price → Strategy's average cost line breached → market fears the company may be forced to sell BTC to pay preferred dividends → funding capacity erodes. CryptoQuant analyst Axel Adler highlighted four pressures in his latest weekly report: bitcoin falling below the average cost, STRC's weakened fundraising ability, the risk of breaking the "never sell" narrative, and dilution from stock issuance. Adler, however, sees no systemic risk in the short term and no trigger for large-scale selling.
Blockstream CEO Calls FUD Overblown
Early bitcoin contributor and Blockstream co-founder Adam Back pushed back on social media, arguing that negative views on Strategy and STRC lack foundation. Back characterized Strategy's approach as essentially "selling bitcoin to pay dividends," which does not alter its bitcoin reserve strategy. Instead, it demonstrates that bitcoin can be used to pay returns to investors while reducing corporate debt. Back added that Strategy is showcasing a new financial model — bitcoin as a cash-replacement asset in corporate treasury management, potentially enabling future enterprises to not only hold bitcoin as a reserve but also use it for capital operations and liquidity management.
Saylor's Familiar Signal: Another Buy Incoming?
On the same day STRC hit its low, Strategy co-founder Michael Saylor posted another bitcoin tracker message on X. Historical pattern suggests that a new BTC purchase announcement follows the next day. This indicates Strategy may be preparing another round of bitcoin accumulation to reinforce confidence in its "never sell" stance. Should the purchase size be meaningful, the discount on STRC could narrow.
STRC Yield Near 11% Attracts Conservative Investors
STRC currently offers an annualized yield between 9.5% and 11.5%, depending on the discount level. For conservative crypto investors, it has become a relatively attractive fixed-income alternative. However, bitcoin price volatility directly impacts STRC's discount. Since the start of 2026, bitcoin has dropped about 23% from its April high of $83,000, underscoring the high-volatility nature of crypto assets. If Strategy follows through with a sizable BTC buy, concerns over the funding chain breaking could ease temporarily.