CoinDesk
Strategy's STRC perpetual preferred slid to $75 on Thursday, a 25% discount to its intended $100 par value, while MSTR dropped 8% to $86, its lowest level since February 2024. The two stocks now price a sharp repricing of investor confidence in Michael Saylor's bitcoin treasury machine, even as the company retains enough USD reserves to cover dividend obligations for almost ten months.
STRC was marketed as a low-volatility income product designed to hover near $100. That promise has broken: the shares have traded in persistent discount for weeks, undermining the funding engine that has powered Strategy's bitcoin acquisitions since the company pivoted away from its MicroStrategy software identity. Mark Palmer at Benchmark previously noted that every point STRC trades below par makes new preferred issuance meaningfully less accretive, even if it does not threaten the dividend itself. Strategy's enterprise multiple to net asset value, its mNAV, has compressed to just 1.05 from the multi-premium levels that defined the 2024 bull thesis.
Why it matters
Two Prime CEO Alexander Blume, whose firm is a SEC-registered bitcoin investment adviser, told CoinDesk the damage is to credibility, not solvency. "Beyond any spreadsheet or logic, markets are about trust, especially when your investor base is retail-centric," Blume said in a Telegram message, adding that "Saylor's repeated pivots and deviations from his stated plans, alongside poor performance of STRC and MSTR, have broken that trust."
Blume has been warning since March that a product paying more than 6% over Treasuries had to embed extra risk. That risk has now materialised in the retail cohort that bought STRC as a retirement income vehicle and MSTR as amplified bitcoin exposure. Strategy's incentives, Blume argued, are not the same as a retail investor's, and it is the retail buyer who has paid the price. He stopped short of forecasting a full unwind but said Strategy looks "highly unlikely" to be a meaningful bitcoin buyer for the foreseeable future.
Market impact
The mechanics matter: STRC was never the dividend itself but the engine that funded further bitcoin accumulation.
Frequently asked questions
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Why is Strategy's STRC preferred stock trading at $75 instead of $100?
STRC was marketed as a low-volatility income product designed to hold near its $100 par. Repeated plan changes, weak MSTR performance, and a broader loss of retail trust have pushed shares to a 25% discount, eroding the funding engine even though the dividend itself remains covered for now.
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Is Strategy at risk of missing its STRC dividend payments?
No. The company still holds enough USD reserves to comfortably meet dividend obligations for almost ten months, and the current STRC price does not put those payments at risk. The issue is the credibility of the funding model, not imminent insolvency.
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What is Strategy's mNAV and why does a 1.05 reading matter?
mNAV is the enterprise multiple to net asset value, or the premium the market pays above Strategy's underlying bitcoin holdings. At 1.05, the premium has nearly vanished from the multi-premium levels that defined the 2024 bull thesis, meaning investors are paying close to net asset value rather than a leveraged…
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How does the STRC discount affect Strategy's bitcoin buying?
STRC issuance was the funding engine behind Strategy's BTC accumulation. Every dollar STRC trades below $100 makes new preferred issuance less accretive, slowing the pace at which Strategy can buy bitcoin without diluting its BTC-per-share metric.
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What did Alexander Blume say about retail investors and Saylor?
Blume, CEO of bitcoin-focused adviser Two Prime, argued that Saylor's incentives are not aligned with retail buyers and that repeated pivots have broken investor trust. He said the risk he flagged in March has now hit the retail cohort hardest, though he stopped short of calling a full unwind.
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