Strategy Inc.’s reliance on its variable-rate perpetual preferred stock, known by its ticker STRC, to fund Bitcoin (BTC) purchases in 2026 has delivered only a narrow accumulation advantage while adding a large and ongoing dividend bill, according to new analysis from K33 Research. The research firm estimates that the extra yearly cost tied to STRC could cancel out that advantage in roughly seven months.
Vetle Lunde, Head of Research at Norway-based digital asset firm K33, shared the findings in an X post on October 13, 2026, drawn from the firm’s research note titled “Chopping lower.” Strategy, the Nasdaq-listed company formerly known as MicroStrategy and the largest corporate holder of Bitcoin, held 848,250 BTC as of October 12. In Lunde’s alternative scenario, which largely avoids STRC financing for 2026 purchases, the company would have held 843,303 BTC. The gap is 4,947 BTC.
How K33 Built Its Alternative Scenario
Lunde’s model removes the roughly $7.5 billion that Strategy raised through STRC in the first half of 2026. It then redirects money set aside for the company’s dollar reserve and for STRC buybacks into Bitcoin, and assumes most related dividend payments are avoided and reinvested at the prices of the time.
The preferred shares did serve a clear purpose. They helped Strategy buy nearly 100,000 BTC earlier this year without selling more of its Class A common stock, which trades under the ticker MSTR. Lunde, however, has called the preferred model a mistake, because the dividend obligation continues long after the Bitcoin purchases are complete.
The Dividend Bill Behind the Numbers
According to K33, Strategy’s annual preferred dividend obligations climbed from about $830 million earlier in 2026 to $1.56 billion. STRC’s expansion accounts for $725 million of that increase.
At a Bitcoin price of around $83,000, that additional $725 million equals roughly 8,740 BTC per year. On Lunde’s figures, that cost would erase the 4,947 BTC advantage in about seven months.
A Cash Buffer That Comes at a Cost
K33 also points to Strategy’s USD Reserve, a dedicated cash pool for covering dividend and interest payments. The reserve stood at $4.88 billion as of October 11, alongside $640.5 million in broader USD cash. K33 estimates the reserve could cover around 42 months of preferred dividends and interest, which lowers the risk that Strategy would need to sell Bitcoin in the near term to meet payments.
Lunde questions how efficient that buffer is. He models the cash earning about 4% while STRC carries a 12% annual dividend rate, and argues that issuing common stock would have been a more capital-efficient way to fund future Bitcoin purchases.
Strategy Shifts Focus to Capital Management
The analysis lands at a time when Strategy is managing its balance sheet more than it is aggressively adding Bitcoin. On October 12, the company disclosed that it bought 250 BTC for $21.5 million and repurchased $192.4 million of STRC preferred stock. The Bitcoin was acquired between October 5 and October 11 at an average price of about $86,194, funded largely through MSTR share sales. The buyback covered about 1.93 million STRC shares, leaving roughly $355 million in remaining repurchase capacity.
That approach follows the Digital Credit Capital Framework Strategy introduced in late June 2026. Under it, the company raised the STRC dividend rate to 12%, set up the USD Reserve with an initial balance of about $2.55 billion, authorized limited Bitcoin sales for defined purposes, and made preferred buybacks a priority. The reserve has since grown, and the company has at times sold small amounts of Bitcoin to support dividends and buybacks, with new purchases slowing while STRC traded below its par value.
Saylor’s Case for Digital Credit
Strategy’s leadership continues to defend the model. Executive Chairman Michael Saylor, in comments on October 14 about the outlook for Digital Credit, presented the preferred shares as a separate product for investors seeking income, while common stock offers leveraged exposure to Bitcoin. He laid out that division in more detail when he explained how Strategy’s debt and preferred stock structure fits together in September.
Other Bitcoin treasury companies are testing similar products. Strive has issued SATA preferred shares with a focus on Bitcoin per share, Japan’s Metaplanet has pursued convertible and preferred-related financing, and the UK’s Smarter Web Company has launched a 12% preferred instrument called MORE, with part of the proceeds going to Bitcoin.
What the Model Leaves Out
K33’s conclusion depends on assumptions that are hard to test. The scenario assumes Strategy could have sold a comparable amount of MSTR stock at similar prices and on similar timing without the STRC channel. It also assumes the diverted cash and avoided dividends would have been turned into Bitcoin at the prices observed. If heavier common stock sales had pushed MSTR lower or diluted shareholders faster, the advantage could look different.
Bitcoin’s price is the other open variable. Preferred dividends are a fixed dollar claim that ranks ahead of common shareholders and does not shrink when Bitcoin falls. If Bitcoin rises far enough, the same dollar cost requires fewer coins to cover. If it stays flat or declines, the cost keeps competing with new purchases.
Seen this way, the K33 note does not argue that Strategy’s Bitcoin strategy has failed. It shows a trade-off between raising capital flexibly today and keeping costs efficient over the long run, and it puts a number on how quickly that trade-off can turn against the company.
What Comes Next
Strategy has scheduled a special shareholder meeting on October 28 to consider daily dividend record dates for STRC and its other preferred shares. The company is expected to report third-quarter results on October 29, which should give investors a fuller view of its reserves, dividend obligations, and Bitcoin activity.
Also Read: Smarter Web Buys 83 BTC After MORE IPO, BitFuFu Bitcoin Treasury Rises to 1,388 BTC
