Strategy's STRC preferred shares fell to a record intraday low of $82.53 on Thursday before closing at $88.59, trading approximately 13% below the instrument's $100 liquidation preference and raising questions about a key funding channel for the company's Bitcoin acquisition strategy. The decline has pushed STRC's effective yield above 12.9% and coincided with a pause in at-the-market share issuance, potentially constraining the capital-raising mechanism that has supported Strategy's Bitcoin treasury expansion since STRC's July 2025 launch. Critics including Peter Schiff have described the structure as dependent on continuous capital raising, while some analysts attribute the sell-off to leveraged position liquidations rather than fundamental weaknesses in Strategy's approach.
Strategy Slows Bitcoin Purchases Following STRC Decline
Strategy acquired 1,550 BTC for $101 million in the week ending 8 June and a further 1,587 BTC for $100 million in the week ending 15 June, bringing total holdings to 846,842 BTC. Those purchases were significantly smaller than earlier acquisitions this year — the company bought 34,164 BTC for $2.54 billion in a single week in April and 24,869 BTC for approximately $2.01 billion in May. Strategy also sold 32 BTC worth around $2.5 million earlier in June to help meet dividend obligations.
Launched in July 2025, STRC was designed to remain close to its $100 benchmark through adjustable dividends, with proceeds primarily used to purchase Bitcoin. The widening discount below par has contributed to a pause in at-the-market share issuance.
Analysts Attribute STRC Sell-Off to Leveraged Liquidations
Peter Schiff has repeatedly described STRC as "a classic centralized Ponzi", arguing the structure depends on raising fresh capital or selling Bitcoin to meet obligations. Crypto trader DonAlt questioned the security's performance, asking why it was "trading like a Ponzi".
Jesse Myers, head of Bitcoin strategy at The Smarter Web Company, argued the decline was driven by leveraged positions being unwound rather than a deterioration in the company's fundamentals. Analyst Scott Melker noted that because dividends are calculated against the $100 liquidation preference, investors purchasing STRC at discounted prices receive a higher effective yield.
FAQ
What caused Strategy's STRC preferred shares to fall to a record low?
STRC fell to an intraday low of $82.53 on Thursday before closing at $88.59, trading approximately 13% below its $100 liquidation preference. Jesse Myers attributed the decline to leveraged positions being unwound, while critics including Peter Schiff argue the structure depends on continuous capital raising to meet obligations.
How much Bitcoin did Strategy purchase in June?
Strategy acquired 1,550 BTC for $101 million in the week ending 8 June and 1,587 BTC for $100 million in the week ending 15 June, bringing total holdings to 846,842 BTC. These purchases were significantly smaller than the 34,164 BTC bought for $2.54 billion in a single week in April.
