Key Highlights
- STRC hit a new all-time low, falling to around $71 before recovering to $74.33, as Bitcoin remained below $60,000.
- Strategy’s Bitcoin funding strategy is under pressure because STRC is trading far below its $100 target, making it harder for the company to raise cash.
- CryptoQuant warned that Strategy should rebuild its cash reserves, as rising dividend obligations and lower cash levels are putting more pressure on the company’s finances.
Strategy’s preferred stock, STRC, fell to a new all-time low on Friday as the company faced growing pressure from falling Bitcoin prices and rising financial commitments.
The stock during early trading hours today dropped to about $71 before recovering slightly, while Bitcoin continued to fall briefly $60,000. Now, the stock trades for $74.33, a 1.80% drop in the last 24 hours.
The decline has raised new questions about Strategy’s ability to continue using preferred shares to finance its aggressive Bitcoin buying strategy.
In short, STRC lost more than 2% in the past 24 hours and traded far below its intended value of $100. At the same time, Strategy’s common stock (MSTR) also continued its decline, falling to its lowest level since February 2024.
Why STRC Is Important to Strategy
STRC plays a major role in Strategy’s Bitcoin strategy. The company introduced it in July 2025 as a preferred stock that pays investors a monthly dividend. The company designed it to stay close to its $100 value while giving investors a steady income.
Since its launch, STRC has become an important part of Strategy’s Bitcoin plan, helping the company raise money to buy about 127,000 additional Bitcoin. Now, that strategy is facing a tougher test.
Because STRC is trading far below its target price, Strategy would receive less money if it sells new shares. In simple terms, the company now has to issue more shares to raise the same amount of cash. That makes it harder to continue buying Bitcoin at the same pace as before.
The falling stock price has also pushed STRC’s effective yield much higher. While the preferred stock officially pays an annual dividend rate of 11.5%, investors buying the shares at today’s lower prices can earn a much higher return. Although that may sound attractive, it usually shows that investors are asking for a bigger reward because they believe the investment has become riskier.
Dividend Costs Continue to Grow
Another issue is the growing cost of paying those dividends. Strategy’s annual dividend obligations on its preferred shares have increased to about $1.2 billion after the company expanded its fundraising efforts.
According to company data, Strategy currently has enough cash reserves to cover roughly 10 months of those dividend payments.
Analysts Focus on Strategy’s Funding Plan
Meanwhile, some analysts believe the market is paying less attention to Bitcoin itself and more attention to how Strategy is paying for its Bitcoin purchases.
Crypto analytics firm CryptoQuant in a recent report, said the company may need to slow down its Bitcoin buying and rebuild its cash reserves before taking on more financial commitments.
“Strategy’s BTC buying here looks more like a liquidity sink than a price catalyst,” said Julio Moreno, the firm’s head of research. He added that “Dividend coverage collapsed from 7+ years to just 14 months.”
Investors Keep a Close Watch
Moreover, Strategy has already taken one unusual step to support its finances. Earlier this year, the company sold 32 Bitcoin for about $2.5 million to help fund payments tied to STRC. Although the sale represented only a tiny part of its total Bitcoin holdings, it was significant because it marked Strategy’s first Bitcoin sale since 2022.
For now, investors will continue to observe both Bitcoin and STRC. If Bitcoin remains under pressure, Strategy’s funding strategy could stay in focus, making the performance of its preferred stock just as important as the price of Bitcoin itself.
Also Read: Saylor’s Bitcoin Strategy Under Pressure: MSTR-STRC Faces Terra-Luna Style Death Spiral Fears
