STRC Falls Below Par Value: A Review of the Timeline from Bond Buybacks to BTC Decline

06/20 18:40

The dividend-paying preferred stock STRC, issued by Bitcoin treasury company Strategy, has recently fallen below the $100 par value, sparking discussions in the market regarding its capital structure and solvency. Key timeline events include: May 14: STRC closed at $100 before the ex-dividend date, while Bitcoin's price remained above $80,000, but market pressure was already evident. During the same period, Strive Asset Management announced that its competing product SATA would adopt a daily dividend mechanism, increasing its yield to 13%, further intensifying competitive pressure on STRC. May 15: Strategy announced a buyback of $1.5 billion in convertible bonds due in 2029 at an approximate 8% discount. The market then noted that the company's dollar cash reserves, intended for dividends and debt support, were used for this transaction. May 26: Strategy confirmed that cash reserves were involved in the bond buyback, reducing the fund size to approximately $871 million, which only covers about 6 months of STRC dividend payments, whereas the company's previous target was to maintain a coverage capability of about 24 months. June 1: Strategy sold Bitcoin for the first time since 2022, selling 32 BTC to demonstrate its ability to support dividend payments through asset sales. Following this announcement, MSTR's stock price fell by 5.9%. June 5: Bitcoin dropped below $60,000, and STRC fell to around $90. June 8: Strategy's shareholders approved changing STRC to a bi-monthly dividend payout, while the company disclosed that dollar reserves had risen to $1 billion. June 15: Strategy bought back 1,587 BTC, increasing dollar reserves to $1.1 billion. June 18: STRC fell below $83 during trading, approximately 17% below the target price, marking a new low since its listing in July 2025, ultimately closing at $88.59. Analysts believe that the core challenge facing STRC lies in its high-yield preferred stock structure being highly tied to the Bitcoin cycle. In a Bitcoin bear market environment, investors are not only reassessing BTC itself but also beginning to reevaluate the financial products and capital systems built around Bitcoin.

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