Strategy Uses BTC Stack to Back STRC as Preferred Stock Trades Below Par

Strategy offloaded 1,638 BTC for roughly $105 million to fund preferred stock dividends and repurchase STRC shares, as its variable-rate preferred stock continues to trade at a discount of around 10% to par.

In a filing with the SEC, Strategy (Nasdaq: MSTR), the bitcoin treasury firm led by Michael Saylor, said the proceeds will be used to meet dividend obligations across its preferred stock classes — including STRC, STRK, STRD, STRF, and STRE — and to support buybacks of STRC shares.

The transaction highlights a broader balance sheet strategy. Rather than a one-off bitcoin sale, Strategy is actively converting part of its BTC holdings into liquidity while maintaining reserves to service a growing layer of preferred equity commitments.

BTC Sale and Shift in Strategy

The bitcoin was sold at an average price of about $64,000 per coin, well below the firm’s overall acquisition cost of $75,419. Despite carrying an estimated $10.9 billion unrealized loss, Strategy remains among the largest corporate holders of bitcoin globally, and the sale represents only a small portion of its total holdings.

The move also marks the sixth consecutive week without a bitcoin purchase, signaling a pause in the aggressive accumulation approach that has long defined the company.

Selling activity has gradually increased. Strategy sold just 32 BTC in May 2026, followed by 3,588 BTC in early July for approximately $216 million, and now this latest tranche — with proceeds consistently directed toward dividends and share buybacks.

STRC Dynamics: Discount, Dividends, and Buybacks

STRC repurchases have become a key lever in Strategy’s capital management playbook. The Variable Rate Series A Perpetual Preferred Stock offers a 12% annual dividend and carries a $100 par value but continues to trade below that level.

As of July 31, STRC closed at $89.46, leaving it roughly 10–11% under par despite offering its highest yield to date.

Issued in July 2025 with a 9% dividend, STRC has recorded seven straight monthly increases, reaching 12% for record dates beginning July 1, 2026. The structure includes a ratchet mechanism: whenever the stock trades below $95, the dividend increases by 0.5%, and once raised, it cannot be reduced.

Strategy resets the dividend rate each month in an effort to support the share price and move it closer to $100, a key condition for issuing new shares and raising capital.

However, the persistent discount has forced the company to halt new STRC issuance under its at-the-market program, limiting its ability to fund additional bitcoin purchases through that channel.

Competitive pressure is also rising. Rival firm Strive has introduced its SATA preferred security, offering roughly a 13% yield with daily payouts and no associated debt, drawing investor demand away from STRC.