Strategy’s bitcoin-linked preferred stock continues to trade at a meaningful discount to its $100 par value, as concerns around dividend durability and intensifying competition from Strive’s SATA weigh on investor sentiment.
The firm’s (MSTR) income-generating preferred security, STRC, closed Tuesday at $91.79—its third-lowest level since launching in July 2025—amid ongoing pressure from softer bitcoin prices and balance sheet adjustments.
The only weaker closes came shortly after its debut, when STRC slipped to $88.60. Although initially priced near $90 and designed to track close to par, the security has struggled to reclaim the $100 level and has not reached it since May 15, the latest ex-dividend date.
Typically, STRC would trade near par ahead of ex-dividend dates—the point after which new buyers are excluded from the upcoming payout. Following that date, the stock would generally fall by roughly the dividend amount before gradually rebounding. However, that pattern broke on June 15, when STRC failed to recover back toward par.
Several key factors are driving the persistent discount.
To begin with, STRC has historically moved in line with bitcoin, which remains under pressure near $65,000—about 50% below its October peak.
In addition, dividend coverage has become a growing concern. After using part of its cash reserves to repay $1.5 billion in convertible debt, Strategy’s remaining dividend coverage has shrunk to roughly seven months, compared to about 24 months previously.
Meanwhile, investor demand is increasingly shifting toward a competing product from Strive (ASST). Its bitcoin-backed preferred security, SATA, continues to trade close to its $100 par value while offering a more attractive yield of around 13%, versus STRC’s 11.5%.
SATA also stands out for its daily dividend payouts, compared to STRC’s bi-monthly distributions. Moreover, Strive operates without debt, positioning SATA at the top of its capital structure with no obligations to convertible debt holders—an appealing feature for income-focused investors.
As a result, the gap between the two securities has widened significantly. STRC now trades at roughly an $8.20 discount to SATA, marking the largest spread on record, with SATA priced just below par at $99.99.
At current levels, STRC offers an annualized yield of approximately 12.53%. This implies the market may be pricing in the need for a roughly 100-basis-point increase in its dividend to revive demand and push the security closer to its intended $100 valuation.
