Strategy Inc.'s STRC Preferred Stock Plummets Below Par, Raising Funding Concerns

Strategy Inc.’s preferred share series A (STRC) fell to a record low of $85.32, more than 10% below its $100 par value. The security, which carries an 11.5% annual dividend, is a key financing tool for the company’s ongoing Bitcoin purchases. The steep discount has sparked debate over whether the market is repricing the stock for yield or signalling stress in the firm’s funding model.

Analysts such as Ali Martinez warned that the STRC structure creates a “dangerous loop” similar to the Terra‑Luna collapse: a prolonged Bitcoin price decline could force the company to raise dividend payouts, raising financing costs just as its primary asset loses value. Others, including Strive CEO Matt Cole, attributed the sudden sell‑off to a leveraged liquidation event rather than a credit problem.

Investors also compared STRC’s yield to the higher‑yielding SATA preferred securities, suggesting the price move may reflect normal yield competition. Strategy maintains roughly $55 billion in Bitcoin, which it says can cover its annual obligations for decades, but volatility in the cryptocurrency market continues to affect its capital‑raising strategy.