STRC

PatternAgainstUsers

"You might be an NPC"...says the guy who line breaks his comments out like a North Korean bot. Chill on the conspiracy theory nonsense. "We" refers to HUMAN BEINGS who BENEFIT FROM INNOVATORS. Clear enough for you? You are speaking with your ego, not reason. You clearly want to be in some kinda cypher punk cool kids club. That does not serve you, or anyone else... that is meaningless hipster BS. The average person is NEVER going to self-custody BTC the way YOU want them to. Go research any major consumer adoption in history, if it's not stupidly simple with a clear value proposition, it almost never catches on unless there is simply no (conceivable) alternative and the product is of utmost importance. That is why STRC simplifies BTC exposure for the risk-avoidant... and it's better than nothing. Learn to ask the question "compared to what?". It will solve a lot of problems and ridiculous expectations in your life. Also stop lecturing people 2x your IQ, it's annoying.

SimpleMoonFarmer

Nobody is prepared for the earthquake that will happen if STRC gets above $100 again.

BitcoinBaller420

I just yesterday talked to a driver in a cab who told me his friend bought 3 bitcoin at $200 each and suggested he buy too. He was crushed he missed Bitcoin while lamenting that he also just figured out how to get 3% on his bank account cash and was getting 0 before that. I explained that he hasn't missed anything, we're still early in Bitcoin's adoption as wealth, 10x inside 10 years, showed him STRC yielding 12%... this is probably a 60 year old guy, nice as all get out, going nowhere as inflation eats his savings... Bitcoin is freedom.

WeekendQuant

They're a fiat Treasury now and they keep diluting shareholders. It's not a good look. They will continue diluting until STRC and STRF get credit ratings. Their Saylor tracker chart looks like dogshit.

Few-Engineering9803

You assume I only hold STRC, that's your first mistake.

Few-Engineering9803

You are confusing your holdings with the price of the STRC stock, common rookie mistake. The STRC price was never above $100.42. Kinda hard to buy a stock at $300 when it barely got over $100.

TheSkunksMisery

Still believe in bitcoin but need cashflow? STRC.

Alternative-Junket28

L'action MSTR n'est pas le priorité de Saylor L'action MSTR va servir a nourrir STRC

Alternative-Junket28

L'action MSTR n'est pas le priorité de Saylor L'action MSTR va servir a nourrir STRC

mikitu

By priority stock I presume you mean preferred and by bond I presume you mean the convertible debt? He is paying off the convertible debt and said it is something they don't want to more. He financed billions of BTC purchased with STRC sales above par, and that's why their priority is not to get STRC to par again, that's how they will finance more BTC purchases and increase sats per share. So no bonds and no covered calls.

bewildered_hobbyist

Bitcoin is my exit strategy. I have been in about the same amount of time as you so very familiar with the meh feeling in bears and the exuberance of bulls. Started this journey blue collar, poor. Many of my peers were on assistance, I was close as well. Now I am hoping to retire during the next bear 3-4 years. I am planning on keeping 90% or so to hold and hopefully give my kids when I die. I am thinking of $STRC as my retirement income and living lower class my remainder so the kids can live a better, more stable and secure, a life than i did. I already consider my life over, just gotta stack as much as I can for them kids!

mikitu

He wants to get STRC back to par as number one goal, he keeps saying that. When STRC is back to par he will just smash buy bitcoin and the sats per share will increase, with no MSTR dilution or BTC sales.

epistmeme

They own 4% of the total supply, I think they're doing alright. There's also an argument for their selling to work on returning STRC to par stabilized their balance sheet and removed risk.

freudianjustthetip

That's not a realistic scenario for at least 2 years, even if the Bitcoin price drops to 10k. MSTR current leverage ratio is 3% at 75k per btc. They have current USD cash to pay dividends for 25 months. They also aren't pumping this Bitcoin run because STRC is not at par-$100 value. Note the moment they hit par on STRC, they'll be pumping this bull run with 100s of millions of new buys.

CommercialDuck7496

its the Strive (Another bitcoin treasury asset company) equivalent of Strategy's STRC. A perpetual preferred equity with a 13% dividend (tax deffered) paid daily. Its goal is to minimize volatility. So lets say in 6 months Bitcoin drops 50%, well every satoshi I move from bitcoin into sata, I could then buy 2.13 satoshi's after the drop

KryptoSC

Well it’s a good sign that Strive sold preferred shares today and bought about 285 Bitcoins after no buys for like over 2 months. Hopefully, Stretch (STRC) will reach par and buy Bitcoin again soon.

impulsive87

This bear has been a great stress test for strategy and STRC. The bull will be wild

Squeiner

I remember the narrative when bitcoin was neat ATH. They said mstr was the biggest  user of btc and without them buying all the time it would collapse, so any btc holdings they have are irrelevant because whenever they try to sell the value would evaporate. Then the market turned. Then at the very bottom of the bear market, they stopped buying and started selling.  They sold thousands of coins into the market at the bottom.  Not only did the value hold, but now we have this rally.  To me, it seems like they proved that even if they sell at the worst possible time, bitcoin is a legitimate reserve asset to hold, with deep instant liquidity, that they can use at any time they want to manage their obligations and balance sheet, no matter what the market conditions are. The narrative that without mstr buying bitcoin would collapse has been completely destroyed. Now their usd reserves stand at almost 5B, STRC has a track record of paying dividends without issue, bitcoin has demonstrated it can hold and even rise while mstr is selling, they've bought back a bunch of strc of obligations, proved bitcoin can be used functionally as a liquid reserve asset even in the worst of times. Idk, im just some fkn guy, but it seems to me this is a very strong setup for the coming bull run.

PatternAgainstUsers

Bitcoin is pristine collateral, it is A) a tool to provide the OPTIONALITY of reducing counter-party risk (this comes with a tradeoff, but for some is an absolute life line when needed), and B) a long-term debasement hedge. Long-term because of it's immaturity as an asset, but this is what solutions like STRC try to give people who want to try and front-run that long-term capability and bring SOME of that functionality forward into the future. The best way for MOST normal, first world people to use BTC right now is to heavily accumulate when it is below business cycle fair values (so, now) and have a long duration view, using it (if comfortable with some counter-party risk) to reduce the rate on their mortgage for example. Actually locking it up, saving it, and getting a financial benefit in the here and now. Bitcoin isn't about changing the government or something, it is about diversifying your risks from debasement - at least on the financial investment side of things. BTC is not a good currency for spending, because it is too valuable for that. Unless you are "SPENDING" (trading) it to buy undervalued (or fair-valued) strong assets to diversify your book at times when BTC is specifically over-valued. This is a bit difficult to do (not that hard though, just plot a 0 to 1 fib between the 2 year and 2 year x 5 MA on a log chart, and when BTC crosses the 0.5 threshold, put in a trailing stop below monthly bullish higher closes). So if you think Apple is cheap or fairly valued at a given time when BTC is ripping... great, go get her tiger... but assets for assets. Dollars are ONLY FOR IMMEDIATE LIQUIDITY, particularly in a crisis.

shelby_xx88xx

I have faith in MSTR and the leadership. They are making adjustments to some complex financial engineering they worked up. They are the largest holder of BTC. And I am confident STRC is back at par and capital flows in heavy as crypto winter comes to an end. Now is when you take the risk and make the big money. But most people are scared and just wait for the next bull run, then FOMO in. Rich get richer, poor stay poor.

cyger

The MSTR story has changed a bit since they are selling BTC to stabilize STRC. Still, during a bull market it will likely do better then BTC.

PrestondeTipp

Nope *** IPO STRC at $90/share Use the $90 to buy Bitcoin at $118,000. $118,000 BTC is now worth $64,000, 45.7% loss Original $90 is now worth is $49.50 Pay $11.42 of dividends in this period. Repurchase STRC for $94 Spending ~$145.42 to have access to $90

reddit4485

And they make money by buying STRC back for less than they sold it for.

Romanizer

That's what they are currently trying to do. STRC buybacks both bring it back to par and reduce monthly obligations.

Argyrus777

Did all that only to have STRC in the red

HSuke

They sold/diluted MSTR again this time for STRC buybacks and dividends. My big concern are MSTR holders saying enough is enough, and then selling. That's what I'm seeing in the MSTR sub: weeks of people leaving for good.

Express-Economist-86

In my early days I lost a couple hundred dollars of BTC on a hot wallet, but after learning and planning from that and comparing it to what I learned and planned in college, I decided it was acceptable tuition. I am but a peasant income-wise, so it stung, but I didn’t die, so it’s not over yet. Instead of simply BTC maxing and holding, I moved into (mainly BTC backed, but still quite diversified) dividend-paying stock. I then learned about President Trump’s “big beautiful bill” which has 100% depreciation on new equipment, and got into physical and NFT hosted miners for some steady gains under a business license. The NFT miners don’t qualify for the same depreciation schedule, those are over 15 years but that’s alright, it offsets taxes paid on daily mining income when I file. Back to the brokerage, I use income from my daily-dividend payer (STRC) to buy BTC in my broker (yeah it’s not my keys - but I move it out when it looks like a scary amount to lose) whenever my in-broker stack says my BTC is down. If BTC is up, I don’t buy it that day, surely one of my diverse dividend-payers is down? I get that instead, and have a commitment to myself to do so every paycheck from working. I estimate I’ve added a bit over a month of cash flow to my year (at a hourly rate I’m ok with) in my dividends, and that’s made it so much easier to stay the course on BTC ventures. Basically feels like free money, and since I’m only buying BTC or elements of my dividend basket (as either turns red), my cost basis is always decreasing and I’m almost daily a little better.

CommercialDuck7496

I agree, too many variables to dig back through, and some that you can't actually calculate right now. Im not gonna hang my hat on the fact that its 89% I dont agree with that number, I can confidently say its better than 89%. However I will absolutely hang my hat on the fact that it isnt 100%, which is why I commented on your post asking why you thought the CAGR of bitcoin didn't matter, and why I firmly rejected your claim that strc is a drag to common shareholders forever already no matter what. The cagr required to salvage the STRC issued at IPO is fairly high, but there too many missing variables to come up with any useful number (sequence of returns like you've pointed out, how long it would take to break even, what portion of the reserve is actuslly attributable to strc etc.) Even by your calcuation it can be under 100% (not that that fixes anything, a required cagr of 80% isnt materially better🤣) , i cant run the numbers accurately so im not even gonns try, but its most likely very high double digits for that tranche by your math of how much the reserve is attributable to strc. Also I would not take the math of the strc issued at IPO and conclude that all strc is a disaster, the IPO is an extreme outlier because they issued them at a discount AND while bitcoin was almost at all time highs. (and didnt raise their first cash reserve untill bitcoin had dropped in price, and then again to a much lsrger extent untill it had dropped even further.) The rest of STRC looks a lot better and has much more runway. The very next worst tranche using your math is 69.76%, and the average of all strc excluding the IPO was 46.8%. Which looks awful for sure. But again I think your version of calculation substainially overstates the damage. Its just way easier to calculate. I also take issue with the claim that mstr would be in a much stronger place *today* if they hadn't issued any strc. All in all they've diluted shares by like 10%, sold 0.8% of their bitcoin while raising 4.7 billion dollars in cash and eliminating 1.5 billion of convertible bonds. For today, I dont think they'd be any better off without strc. The counterargument would be that future dividend obligations exist, but that's not really an argument of mstr being worse position today, thats an argument they will be worse off in the future (if bitcoin doesnt appreciate rapidly.) You can also point out that net BPS is worse off with strc today, and thats true, but its not a significant difference yet, and that difference is also offset by the fact that the stock is significantly lower risk now that they have the 4.7 billion in cash, and they wiped out 1.5B of the convertible bonds. Which if bitcoin drops further would have looked a lot more scary when they come due without strc. I agree that STRC has a sequence of returns risk for sure, and I also agree that having that multi year reserve is goofy. And I hope after the bonds are paid they reverse course and go back to 12-18 months instead of 24-36. Or dynamicslly adjust it to have a larger reserve when they are well in the green on their bitcoin, and then dwindle down the reserve while they are in the red. I disagree with that last part too, I would say thats a bigger critique of the common stock rather than the prefs. Strc isn't nessesarily structurally designed to buy tops... Mstr is. STRC can raise more money even without bitcoin being at all time highs. They can choose when to increase or lower demand for strc by changing the interest rate. I don't think STRC is an inherently flawed product I think they just need to adjust the size and timing of their usd reserve. Also all of strc looks a hell of a lot better if they end up using the majority of their cash reserve they are building now to pay those bonds. That could drop the 7.6 million shares you budgeted for mstr shsres sold to fund the reserve from the strc ipo down to like 2 or 3 million. Which makes the numbers way better. But time will tell on that one. Also, just because past strc issuance was bad, doesnt mean future ones will be. When strc gets back to par in q4 of this year or q1 of next year, i'd predict that strc issuance to be cleanly accretive in the long run almost no matter what.

Hfksnfgitndskfjridnf

> But that is materially different from saying the STRC already issued is permanently a loss today. Even using your own numbers and your own attribution methodology, the worst tranche has not yet crossed the irreversible threshold. And if the worst tranche has not crossed it, the blanket statement is even harder to make about the later STRC issuance, which started with substantially better economics. Thanks for agreeing with most of what I’ve said. There are a ton of moving parts and trying to get a truly accurate depiction of what exactly is or is not attributable would take more time than it’s worth. If you’re going to hang your hat on the fact that only 89% is gone after a year instead of the full 100%, I would say that is rather foolish. I will concede that they technically aren’t in an irrecoverable position quite yet, I’ll let you do the math on what CAGR Bitcoin needs to salvage the situation, I’m guessing triple digits. It’s clearly a disaster and I don’t see how a reasonable person could say otherwise. MSTR would be in a much stronger position today if they hadn’t issued any STRC. But this is the issue with STRC, it’s not that BTC just has to grow faster than the dividend rate, it also depends on the path it takes getting there. And having to keep years of dividend coverage makes that hurdle even higher. And the fact that structurally they are designed to buy tops because that’s when they have the most access to capital means it probably won’t be that great of a funding mechanism going forward either.

CommercialDuck7496

I think your historical math and data is mostly reasonable, but I don’t think it supports the conclusion and claim you started with. I’ll grant your framework for the sake of argument. The original STRC IPO bought 21,021 BTC, which you calculate represented roughly 10.9 million MSTR share equivalents of additional gross BTC exposure. You then estimate roughly 2 million MSTR share equivalents have been consumed by dividends already paid, and allocate another roughly 7.6 million shares of reserve building dilution to that original STRC tranche. That gets you to about 9.7 million shares of attributed dilution against an original benefit of about 10.9 million. But notice what your own calculation says: 10.9 million minus 9.7 million is still positive by roughly 1.2 million share equivalents. In other words, even under your attribution assumptions, the original July 2025 STRC IPO ... * the worst tranche by fsr*, because it was issued at a discount, bought BTC around $117k, and has accumulated the most dividends ... has still not crossed into negative attributable gross BTC/share. That matters because you’ve now clarified that your actual irreversible threshold is gross BPS going negative. On that specific point, I agree with you: if a particular STRC tranche has genuinely caused gross BTC/share to fall below the no-STRC counterfactual while the STRC senior claim still remains outstanding, then Bitcoin simply going up cannot make its net-BPS contribution positive. As BTC rises, the BTC-equivalent burden of the fixed-dollar claim approaches zero, so net approaches gross from below. If gross is already negative, BTC appreciation alone cannot push net above zero, sure. My point was, we arent there yet. We are closer than I thought for the OG tranche, but the others are substainally better. But by your own numbers, that has not happened yet, even for the original IPO tranche. So the statement you have been making throughout this discussion, that “the STRC they have already issued is permanently a drag on shareholders regardless of what Bitcoin does,” is stronger than what your own calculation establishes. What you’ve actually shown is that the original tranche may have consumed roughly 89% of its initial gross BPS benefit under your allocation methodology. Losing 89% is NOT the same thing as crossing below zero, and that difference is critical here. I also think the 7.6 million share reserve allocation needs to be treated as an estimate rather than a fact. Allocating 19.3% of reserve building issuance to the original STRC tranche because it currently represents roughly 19.3% of covered annual obligations is a reasonable simplifying assumption, but it is still an assumption about the counterfactual. The USD reserve is pooled across preferred dividends and debt interest, the capital structure and STRC outstanding balance changed throughout the period, and the exact percentage of the marginal reserve requirement attributable to the original July 2025 tranche was not necessarily 19.3% at every point when those shares were issued. A truly precise calculation would have to reconstruct the liability mix and reserve requirement through time rather than apply one current percentage to the entire period. There is also a potential accounting issue we should be careful about before simply adding the 2 million historical dividend share equivalents to the 7.6 million reserve shares. If some common issuance was used to replenish the USD reserve after reserve cash had already been spent on dividends, then counting the historical dividend separately and then allocating the replenishment issuance as additional reserve dilution can double count the same economic cost. You would need to follow the reserve cash flows and distinguish cash still sitting in the reserve for future obligations from cash that replaced prior distributions before adding the two buckets together. And there is an important distinction between gross BPS and economic value here. If you are strictly calculating gross BTC/share, then yes, cash in the reserve gets zero credit by definition and the additional common shares reduce gross BPS. I have no disagreement with that. But if you move from “gross BPS fell” to “that amount of shareholder value has already been permanently destroyed,” then the cash raised by those shares cannot simultaneously be treated as worthless. It remains an asset until it is spent. Gross BPS deliberately ignores that asset; an economic or net value analysis cannot. Most importantly, future Bitcoin and MSTR prices still matter until the tranche actually crosses your negative gross threshold which has been the thing ive been trying to get across FROM THE VERY START. STRC’s dividends are fixed dollar obligations at a given dividend rate. If MSTR remains depressed, servicing those obligations can consume a lot of common shares and eventually erase the remaining gross BPS benefit. If Bitcoin and MSTR appreciate substantially, the same dollar obligation can be funded with far fewer common shares. So whether that remaining ~1.2 million-share equivalent cushion ultimately gets consumed is not predetermined today. Even tho we woule probably both agree that it most likely will. I think the strongest version of your argument is: “The original STRC IPO has already burned through most of its initial gross BPS benefit, and if the cumulative servicing dilution eventually exceeds that initial benefit, then BTC appreciation alone cannot repair the resulting negative gross BPS.” I agree with that. But that is materially different from saying the STRC already issued is permanently a loss today. Even using your own numbers and your own attribution methodology, the worst tranche has not yet crossed the irreversible threshold. And if the worst tranche has not crossed it, the blanket statement is even harder to make about the later STRC issuance, which started with *substantially* better economics.

Hfksnfgitndskfjridnf

Go ahead and look up the historical numbers. When STRC IPO’d they issued 2.8 Billion notional and bought 21,021 BTC with it. Based on their Bitcoin per share that was the equivalent of 10.9 million MSTR shares. Since then they’ve paid out $10.94 in dividends on those STRC shares (through July 31), which if you go by the MSTR share price at the time paid (which is how you have to do it because they issue the shares the week of the dividend payment) equates to 2 million MSTR shares to cover just the STRC IPO share dividends. Now since the start of June they’ve issued 39 million more MSTR shares to build the USD reserve. The STRC IPO accounts for 19.3% of the dividend obligations so if you attribute that ratio to the shares issued you get an additional 7.6 million MSTR shares attributable to STRC IPO. (I’m even ignoring the BTC sales fyi). This means in total they’ve issued 9.7 million MSTR shares to pay for the STRC IPO dividends and USD reserve. So they have lost 89% of the gross BTC yield from the STRC IPO and are still on the hook for 330 million in yearly dividend obligations forever. I’m not saying future STRC issuance can’t or won’t be accretive. I’m saying the STRC they’ve issued so far is a massive negative for shareholders. They’ve given up essentially all gross Bitcoin yield already and the dividends will continue to be a drag forever. Once the gross Bitcoin per share attributed to the STRC issuance goes negative, it does not matter what Bitcoin does subsequently, they are already at a loss. The company would have had more gross and more net Bitcoin per share if they simply hadn’t issued any STRC period.

CommercialDuck7496

You’re right about one narrow point: if we freeze Strategy’s BTC holdings and common share count today, Bitcoin going back up does not magically repair gross BTC/share. Gross BPS only changes when the BTC numerator or common-share denominator changes. Where I disagree is your conclusion that this means STRC can never become economically accretive, or that its maximum accretion is the company’s 1.7% gross BTC yield. That 1.7% is the aggregate gross BTC/share result of everything Strategy has done this year. It is not the isolated contribution from STRC. STRC itself does not issue common shares; when Strategy sells STRC and buys BTC, gross BTC/share mechanically goes up because BTC increases while the common denominator does not. Strategy explicitly notes that non-convertible preferred issuance used to buy BTC increases BPS while simultaneously creating senior claims that gross BPS does not capture. What subsequently dragged gross BPS down was largely separate common issuance, including common issued to build the USD reserve. If you want to argue that some of that dilution should be charged back against STRC because the reserve exists partly to service STRC dividends, that’s completely reasonable. I’ve already agreed that it raises STRC’s break-even materially. But you have to actually attribute the dilution and compare the counterfactual; you can’t look at the company-wide 1.7% gross yield and declare that STRC itself was only 1.7% accretive. Also, ‘gross is the upper limit of net’ does not mean gross BTC yield is the upper limit on the percentage increase in net value. Imagine gross BPS is 1.00 BTC but senior claims reduce net BPS to 0.60 BTC at a depressed BTC price. If BTC rises enough that those fixed-dollar claims become relatively tiny, net BPS can approach 1.00 BTC. That’s a roughly 67% increase in net BTC-equivalent exposure without gross BPS changing at all. Strategy explicitly says its gross BPS metric does not account for the senior claims created by preferred financing. So there are two different statements here. ‘BTC going up alone cannot increase gross BTC/share’ is correct. ‘Therefore BTC’s future return cannot determine whether STRC was a profitable financing for common’ is not. STRC exchanged a fixed-dollar preferred claim and ongoing cash dividends for BTC. Whether the BTC purchased ultimately appreciates enough to exceed the issuance discount, dividends, and any common/BTC sacrificed to service STRC necessarily depends on Bitcoin’s return, which has been my whole entire point from the very first comment. If BTC never recovers, STRC can absolutely have been a bad trade. If BTC rises enough, the incremental BTC purchased can become worth far more than the fixed-dollar claim and cumulative servicing cost. That does not retroactively increase gross sats/share; it makes the financing economically profitable despite its carrying costs. Those are different concepts. And importantly, Strategy itself warns that BTC Yield/BPS are not measures of intrinsic value or stock-price performance. They are specifically gross BTC-per-share KPIs. So I’m not conflating gross and net. My entire point is that you cannot use gross BPS alone to answer whether STRC ultimately created or destroyed economic value for common.” Your statement “gross is only +1.7%, therefore STRC can be at most 1.7% accretive” is not valid. The 1.7% is the net result of multiple transactions pulling gross BPS in opposite directions. You could have STRC contribute +10% gross BPS and common issuance/reserve building contribute −8.3%, leaving +1.7% overall. The +1.7% aggregate number by itself tells you nothing about STRC’s isolated contribution.

CommercialDuck7496

What you don't understand is that selling bitcoin right now may allow them to buy more in the longer term. Their strategy is to issue debt to buy more bitcoin overtime. In this instance they are selling bitcoin to try and increase their credit rating. Look into it, s&p rated them at a b- while completely ignoring the bitcoin they held, they literally acted as if it weren't there. Obviously a company that holds 90+% of its balance sheet in bitcoin is going to have a worse credit rating if their bitcoin isn't being valued by the credit rating agencies. The S&P told them they needed to do a few things to improve their credit rating, there were more than just these two, but primarily it was prove that you can sell your bitcoin, and reduce or remove your convertible bond debt. Seriously look into it! This isn't some forced deleveraging, he hasnt been forced to sell a single satoshi (which is obvious if you look at the numbers), this has been a optics move to ease investors and get a better credit rating. Moving onto your other points. There was absolutely a hype cycle in 2021. He started buying bitcoin in 2020, and his stock proceeded to do a 8x in 4 months. But reguardless that wasn't even my point, my point was that a stock dropping 90% doesn't mean its failed. There are plenty of other examples carvana is the one that comes to my head first, but stock value dropping for a year or two does not prove the stock has failed. And look at the timing his stock has been amplified bitcoin ever since he started buying it. So of course when bitcoin goes up, his stock does, and to a higher degree, and when it goes down, his stock goes down to a higher degree. Its really not rocket science. Yes thats correct they didnt sell a single share because their reported profit per share was in the negatives, that really doesn't impact their decision making at all. I think STRC depegging did influence when they started to sell, I think they felt like people were worried that they wouldnt be able to fund strc if mstr's mnav went below 1, so they started to pay thr dividends with bitcoin even though they havent yet had too, to ease investors concerns. But again, they hsvent been forced too, they raised 4.1 Billion dollars from mstr ATM'S, sold 430 million bitcoin and paid like 300 million in dividends, the bitcoin sales obviously were not required to pay anything The "expiriment" if you wanna call it that has not failed, they have sold thousands of bitcoin over the last month and a half, and bitcoin has actually had a slight rebound, and its not like it tanks even on the days they report it anymore like it did that first time. My guess is, the next time they get a credit rating it will be significantly above a b- I will agree with you, their first sale probably was what caused the market to tank, after that, its not been inlfuencing the prices. And your analysis that we would be at 84k without him selling is absolutely completely flawed. Bitcoin and the stock market are somewhat correlated, but they don't always move at the same time. And bitcoin is closer to a proxy for global liquidity than it is the stock market. Also to say it hasnt responded at all would be again incorrect. Bitcoin went from like 58,700 to 64,000 in the same time the sp500 went from 7350 to 7800

fan_of_hakiksexydays

Oh my god there is so much gold here, thanks for this lol. This really illustrates how deeply delusional MSTR supporters have had to become now. Strategy has not failed? Their whole "strategy" was literally stacking BTC and never selling BTC. But now they're not doing that. And now they've switched to their new strategy of buy high and sell low lol. Wait, your whole argument is that it bounced back less than 2 years into their new Strategy of buying BTC? You realize they only started buying their first BTC in the middle of 2020, right? Also the whole hype train about MSTR started in 2024. 2022 was 2 years before the whole hype. But the one that takes the gold is your argument that "no they didn't have to, they chose to sell because they wanted to show that if they sold it wouldn't tank the market". So it wasn't because their stock was tanking, their profit per share was going into the negatives, or that STRC was unpegging too much for too long, or that they were hitting losses in the billions, or that their whole system was collapsing. It was because they wanted to do a social experiment to show that if they sell the price wouldn't go down? 🤣 That experiment seemed to have failed. They started to sell in the final week of May when the price was above $73K. Then the market tanked. The only reason it stopped tanking (other than always having a bounce when there is a drop this big), is because of the very bullish march of traditional markets into record territory. Plus the constant renewed hopes that the war with Iran might end.

Hfksnfgitndskfjridnf

The 1.7% is their gross BTC yield, not their net. Their net BTC a share is very negative for the year, not positive. Gross is the upper limit of net, if Bitcoin goes to 1 billion a coin then net and gross will be essentially equal. But Bitcoin going up does not increase gross Bitcoin per share. They issued a bunch of STRC, waited for Bitcoin to crash and then diluted to raise the cash reserve. This is why their gross Bitcoin per share for the year is so low. THIS MEANS THAT EVEN IF BITCOIN GOES BACK UP IT STILL WONT BE ACCRETIVE. (It will be at most 1.7% accretive). Gross is not down because Bitcoin is down. Gross is down because they diluted so much at bad prices. Now it doesn’t matter if Bitcoins price goes back up, they’ve already diluted so much it’s a loss. You are conflating gross and net. If gross BTC per share hasn’t increased because of the STRC issuance by now, it can never be accretive. Gross is the upper limit of how much net can be. If the upper limit doesn’t go up, it’s not accretive under any Bitcoin price.

Laukess

I don't really understand your reply. MSTR holders want Strategy to buy as much bitcoin as possible. STRC holders want Strategy to hold a fiat reserve so they can be paid out. Holding fiat and buying bitcoin are opposites. They've even started selling bitcoin to increase that fiat reserve. Right now they try to defend STRC, and grow their fiat holding. I understand why STRC holders want this. I don't understand why MSTR holders prefer that to them buying more bitcoin? >Because we believe in bitcoin long term Can you expand on this? Would those people not buy MSTR instead over STRC? I don't really feel like you answered my initial question. At it's core, I want to know why MSTR holders are happy with the pivot to STRC. Sounds like it's against their interest, and you even mention that being the case on the MSTR sub, so is that the answer? They aren't happy? The downvotes are because it sounds vaguely like a critique of Strategy? I don't feel like the question was bad or in bad fait. I have no interest in Strategy myself, but I think the focus to STRC is interesting. Seems like a great way to broaden the product so people who don't care about bitcoin can get access to a high dividend stock/product.

Less-Information-256

You’re even more of an idiot than the mstr investors if you invest in STRC without believing in Bitcoin. It literally doesn’t work if Bitcoin doesn’t succeed.

quintavious_danilo

but wasn’t it available through selected brokers like schwab and fidelity earlier under a different ticker? I remember people buying it early and the ticker was MCSTP not STRC. Here are user reporting buying it under $90 https://www.reddit.com/r/MSTR/s/GvRQkFAZ1M But yeah, I did some research and i confused STRC with STRK which had $80 IPO. My fault

Full-Atmosphere-4818

If the price if STRC is not goin up towards par after these sales then the answer is... no... it's not working.

CommercialDuck7496

Yes I don't believe he is going to use all of the funds to pay dividends, especially in the case where he has to pay the bonds back in cash as opposed to stock, which I see as a very very likely possibility. If STRC went back to par do I think they would be holding back 30% of the cash raised in the reserve forever, no I don't . I don't think if they issued 100 million in STRC that they would increase the cash by 30 million, that would be goofy when the reserve is already so large. Not impossible, but not what I would anticipate. I'm not privy to them saying they are projecting to do that, when did they say that? I heard them say they would aim to keep the reserve around 2.5 years, but its already above 2.5 years, so they wouldn't have to keep 30% aside for the reserve, while its above 2.5 years. I literally just did the math for you on one of these threads on the STRC IPO, and the gatcha isnt about them being down a certain percentage, its to prove to you that there is a bitcoin price where it is accretive. which is the point you STILL don't seem to understand. I don't know how else to explain it at this point. The simple math on why they have a 1.7% yield for the year is that bitcoin holdings rose by about 25%, and diluted common share count rose by 22.9% I think the reason you would expect it to be higher is that they used to spend every dollar they acquired to by bitcoin, but recently they have issued shares to build the USD reserve and pay dividends. The disconnect between everything they've done being possibly accretive if bitcoin goes up, and the fact that they have been diluting the last 2 months is simply that..... BITCOIN HASN'T GONE UP. as i've said before, the STRC issuance isn't accretive untill bitcoin is above 95k. ITS NOT THERE YET, IT WON'T LOOK LIKE ACCRETION UNTILL THATS HAPPENED. The price of bitcoin going up DOES increase their NET bitcoin per share. and it isn't magic. Its not that bitcoins price increases the amount of bitcoin they own, its that it reduces the amount of bitcoin that the liability represents. The debt they hold is measured as $, when bitcoin rises the amount, the same dollar number of debt, represents a smaller number of bitcoin. so for example, if they issue 1 stock of strc and collect 90$, buy 90$ of bitcoin, with bitcoin at 100k, and it creates a 100$ liability. At first, immediately you lose 10%, ( im disregarding dividends for this demostration, im gonna exclude them to keep it as simple as possible. go back to the previous explanation if you want them included to show the math still works.) So you would have 0.0009 bitcoin, and create 0.001 of a liability (because a 100$ liability at 100k bitcoin is worth .001) , so at first, you would lose 0.0001 bitcoin. If bitcoin goes down to 50k, now you still own 0.0009 bitcoin, but that 100$ liability, is now worth 0.002 bitcoin, so now issuing that stock lost you 0.0011 bitcoin compared to doing nothing Then if bitcoin went to 200k. you would still have 0.0009 bitcoin, but that 100$ liability you have, is only 0.0005 bitcoin. So in this case, with bitcoin going from 100k to 200k, issuing that stock went from losing 0.0001 bitcoin, to gaining 0.0004 bitcoin Does that part make sense to you? I'll try and explain it a different way if not

DsrptFinance

Right conclusion, wrong mechanism. STRC issuance itself doesn’t dilute — no new common shares, BTC/share ticks up on day one. The erosion is downstream: \~$1.5B/yr in preferred coupons now getting paid by selling BTC and printing common through the ATM. The funding loop is what’s bleeding you, not the issuance. And “doesn’t matter what BTC’s CAGR is” is backwards — it’s a carry trade, and the problem is worse than that. STRC reprices monthly to hold par, so the hurdle rate rises as the collateral falls. Seven hikes since July ‘25, now 11.5%. That’s short vol with funding cost indexed to your own distress. The hazard isn’t dilution arithmetic. It’s the trigger: STRC slips below par, ATM stalls, and the choice becomes massive dilution or cumulative coupons stacking senior to common. Watch the funding spread, not BTC/share.

CommercialDuck7496

Strategy has not failed. A drop in market cap does not mean they have failed, Strategy themselves is a perfect example of that, they fell 90% from their peak in 2021 to their bottom in 2022, and then proceeded to 38x from there (proving it definitely didn't fail.) 8 Billion in net losses is about 15% of their total assets, that's doesn't mean they have failed. Additionally, these are almost entirely market to market losses, not an actual realized loss. STRC has been on a relatively stable increase, back up to 95$. Strategy has not HAD to sell their bitcoin to keep itself from spiraling that is not true. they have had to pay $330 Million in dividends and interest, raised 4.1 Billion from common stock issuance, and net sold $195 Million bitcoin. They CHOSE to sell the $429 Million of bitcoin to prove that the market won't tank if they do (and outside of the first sale they have proven that successfully) to eventually improve their credit rating, and ease concerns of a death spiral. In total they have sold 0.9% of their bitcoin holdings. They have increased their bitcoin stack by 167.5k since the start of the year, by 123k in the last 6 months, and by 21k in the last 3 months. and increased Bitcoin per share by 1.7% year to date, in the same time that bitcoin has dropped 27% year to date. That's FAR from a failed company, they are just having a rough few months, as any leveraged bitcoin company would when it drops 20+%

Hfksnfgitndskfjridnf

Are you saying that Saylor and the board is lying and the cash reserve isn’t for the preferreds after all? Are you saying that if they start issuing STRC again they won’t be holding back 30% of the cash raised in reserve? Because that’s what they’re projecting to do. Why don’t you do the actual math about the STRC IPO and tell me what you get? You really think it’ll be a big gatcha if the number you come up with isn’t actually 0 but 25% of the original purchase? Why don’t you give me a good explanation of how Strategy has managed to raise close to 20 billion in capital this year, purchased 175k Bitcoin yet somehow only have a 1.7% yield for the year? What’s the math on that? How is everything they do supposedly accretive yet the end result is basically no gains on a per share basis?

CommercialDuck7496

He needs to raise $6.7 Billion to pay the bonds anyways. It may not end up being a cost associated with STRC. Even to the extent that I agree that it's a cost associated with STRC, you can't just subtract 4 billion from the amount of bitcoin they purchased. First off, STRC is only 70% of the total dividend and debt payments. secondly the reserve is still an asset, its not a 0. Thirdly, that doesn't play into the calculation of "If they didn’t have any BTC to begin with and simply issued STRC at IPO they would have 0 Bitcoin at this point, so Bitcoin could go up 100% a year forever and it wouldn’t matter." AND even if it did, it STILL wouldn't be true...

Hfksnfgitndskfjridnf

It’s hilarious that since STRC IPO they now have about the same gross BTC per share than they did prior to the IPO. AND they now have 10 Billion in senior claims that cost them 1.2 Billion a year that they didn’t have before. STRC so far has been a complete disaster for common shareholders. Could future STRC issuance actually be accretive? Sure, but the current STRC they’ve sold is already a net loss and will continue to be a drag going forward. This is what happens when you issue STRC at 90, buy BTC at 117k and then wait until BTC drops to 60k before issuing common stock to build a 3 years cash reserve. 12% * 4 (3 years of cash reserve + 1 year of divs paid) * 2 (BTC price is half what they bought it for) *10/9 (issued STRC IPO at 90) = 106%. So they’ve already diluted more than the STRC IPO increased their BPS by. It’s already a loser and future payments just make it a bigger loser going forward. Shareholders better hope they don’t screw up future STRC issuance as much as they’ve screwed up what they’ve done so far. (Doubt)

fan_of_hakiksexydays

Going to? Strategy is already coming apart at the seams. MSTR has already dropped more than 80%. STRC still hasn't been able to peg back for the last 3 months despite all efforts. Strategy hasn't been able to buy BTC in 2 months. And now Strategy has had to break from its core "strategy" and has had to keep selling BTC to keep itself from spiraling too much.

Hfksnfgitndskfjridnf

The cash reserve came from selling MSTR but it’s a cost associated with STRC. It absolutely counts against the BTC yield of STRC. They wouldn’t have needed a cash reserve otherwise.

CommercialDuck7496

Because we believe in bitcoin long term, and this drop doesn't really hurt us unless it stays like this for years. Why would this push us away from MSTR? Your expectation made complete sense before the release of STRC and the other prefs. My guess is he is only gonna raise maybe 4 or 5 more billion dollars through dilution or bitcoin sales, that would be enough to cover the convertible bonds. and dividends payments for over a year. By then STRC should also be back up to par, and the bitcoin buying can continue (at the bottom!) My feeling is that most MSTR holders despise STRC, or at least thats the vibe I get from the MSTR subreddit. But I have no real data to support that, and I myself hold more STRC than MSTR at the moment, although I plan to rotate into 90/10 MSTR/STRC over the next 10-14 months

CommercialDuck7496

Thats not all from STRC though. and that doesn't preclude it from being accretive in the future, when bitcoin prices go back up

Hfksnfgitndskfjridnf

They’ve raised 4 Billion in cash to build their reserves. Thats 60k Bitcoin at current prices. Thats why STRC is already a loser.

CommercialDuck7496

Everything you just said is correct as far as I can tell, and none of it disproves what I said. You're explaining why net BPS is price dependent, which is exactly my point. A common issuance that looks net BPS accretive at a low bitcoin price can become dilutive if bitcoin rises enough, and the inverse applies to a fixed dollar financing like STRC. an STRC issuance that looks net BPS dilutive today can become economically accretive if the BTC it financed appreciates enough to overcome the preferred claim and dividends. So Bitcoin's CAGR absolutely matters when determining whether STRC ultimately created or destroyed value for common shareholders. Saying a tranche is net BPS dilutive today is not the same as saying it is permanently economically dilutive regardless of Bitcoin's future price. On another note, I don't disagree with you that CEBE is a flawed framework. My guess is that they are using it, because its the only thing that makes it look ok to issue more shares right now, which it seems like they want to do for raising capital.

CommercialDuck7496

You are correct, I took a shortcut cause it's kinda impossible to determine what their average sale price from the bitcoin they bought with STRC is, partially because they didn't actually sell bitcoin to fund it untill very recently, and also because the increase in cash reserves, and common stock issuance clouds it, but yes if you change the average sale price you can come up with different numbers. but it doesn't change the fact that, THERE IS A NUMBER WHERE ITS ACCRETIVE, which was my whole point, that if bitcoin increases in value enough, STRC even the worst tranches, can become accretive. If you believe the average effective sale price (you'd have to take into consideration that issuing shares at a premium raises the effective sale price) is 60k, then the breakeven today for the very worst tranche, becomes 176k, if you believe the average effective sale price is 65k, then the breakeven for today becomes 172k, at 70k, its 168k, at 75k its 165k. Chatgpt 5.6 sol thinks the average effective STRC bitcoin sale price for dividends from that first tranche is 78.3k which would make the breakeven 163.5k. Strategy did not screw up, because they are operating under the assumption that bitcoin grows 30% a year, which would make all of their STRC issuance accretive.

CommercialDuck7496

This is factually not true. They bought like 120k bitcoin from the proceeds of STRC, and have paid 620 million in dividends, at current prices that would be like 10k work of bitcoin, He would have 110k more bitcoin than he started with if you ignore everything else. MSTR will not forever be worse off from what they've done with STRC. they currently have a lower net bitcoin per share because the price of bitcoin has gone down, so the relative burden of the liabilities is increased as a percentage, and they've had to pay the dividends, but if bitcoin goes back up, it will be a net increase in bitcoin per share again. I ran you through the math in a different comment. but the STRC IPO shares have not lead to a permanent decline in net BTC per share, if bitcoin gets to 185k by the end of 2028, Even the IPO, which is the worst out of all of the STRC issuance, will be accretive.

Hfksnfgitndskfjridnf

How are you getting the current break even level is 149k? Are you simply taking their buy price and adding the dividends to it? Because that is the wrong way to analyze it. MSTR has to pay out the dividend every two weeks, so you must take into account the price of Bitcoin at the time they have to pay out, that’s when the dilution happens. It’s like when you retire, you have to live off your portfolio and if your portfolio tanks in the first year you’re screwed even if in the longer term returns are higher than your withdrawals. MSTR screwed up the execution because they decided they needed to raise 3 years of dividend coverage AFTER Bitcoin tanked 50%. If the stock market tanked and then you sold afterwards to cover 3 years of living expenses. Your portfolio is now so small that you need insanely good returns just to not run out of money. That is what MSTR did. They retired, saw the market crash and then went to cash. The only reason it doesn’t look this way is because STRC is only a small part of the total.

Hfksnfgitndskfjridnf

I don’t think you get what actually has happened because it’s obscured by the fact that they started with over 600k Bitcoin before they issued STRC. If they didn’t have any BTC to begin with and simply issued STRC at IPO they would have 0 Bitcoin at this point, so Bitcoin could go up 100% a year forever and it wouldn’t matter. MSTR will be forever worse off from what they’ve done with STRC so far because they waited until Bitcoin tanked and then raised 3 years worth of dividend coverage. If they had done it at the same time they bought the Bitcoin this wouldn’t be the case. And future issuance of STRC may be accretive long term depending on how quickly BTC appreciates. But the STRC IPO shares have already lead to a permanent decline in BTC per share.

CommercialDuck7496

They didn't get nothing out of issuing STRC, it will be accretive if bitcoin goes up 20-25% on average per year from here for at least 4 or 5 years

CommercialDuck7496

People won't demand 12% forever, they demand that right now because STRC is risky in so many ways. People are uncertain about bitcoin, people are uncertain about Saylor defending the prefs, people don't understand strategy as a whole, and people feel betrayed by him promising no volatility and now there is no volatility. and right now they are only 3.9x over collateralized. When bitcoin is getting new all time highs, more people learn and understand bitcoin and strategy, STRC the other prefs have been out for a few years, there is no convertible debt, and they are 5-7x overcollateralized, people may be just fine with only a 9 or 10% yield. I also think at some point they will drop to weekly or daily dividends, which will also increase demand (causing a lower required yield to stay at par.) Also if interest rates come down, their dividend can decrease by an equal amount while maintaining the same credit spread So while yes I agree if today they dropped the yield even 0.25%. it would likely send the stock down significantly. that likely isn't true in a few years if bitcoin does well.

CommercialDuck7496

The problem is, he may have to pay back large sums of cash when bitcoin is down, that's the risk, STRC doesn't force him to sell all at once. Also that market is only so big, he wants to buy 10's of billions of dollars of bitcoin a year, that market isn't big enough for that. He can do that with STRC, and removing those bonds might create more STRC demand because it will be perceived as less risky. Also, he also gets more flexibility with STRC, there is no date an STRC holder can simply demand their money back, and the 12% interest isn't fixed forever it can be adjust downwards later. So generally yes, the converts are cheaper financing with better economics, but a concentrated risk. STRC is more expensive financing, but it has no maturity wall, just a manageable recurring carrying cost. I think he's choosing STRC because its going to allow him to buy more bitcoin in the long run

CommercialDuck7496

Bitcoin doesn't need to generate interest for strc to be profitable, it just needs to grow faster than say like 15% per year over the longer run. He is managing STRC and they are going to continue to manage STRC

CommercialDuck7496

That's true right now because bitcoin is down. But when bitcoin goes back up that won't be true. The breakeven right now for their WORST STRC tranche is roughly 149k. so if bitcoin went to 160k by the end of the year ALL of their STRC would be accretive, and the stock would be lower in that case if they had never issued the STRC. that breakeven number for the worst tranche moves up over time. If the dividends stay the same, the breakeven becomes 155k by the end of the year, and 165k in a full year from now. 171k by the end of next year, and 187k by the end of 2028. Their average STRC breakeven is much better because after the initial sale there was no discount, and the average bitcoin purchase price was lower, and their average amount of dividends issued is lower (because the newer ones haven't received as many dividends.) The rough math for today's break even is about 92k. so if bitcoin went to 93k tomorrow, even though the first tranche would be dilutive, in total, STRC as a whole would be accretive. By the end of the year, the average breakeven moves to about 95k, end of next year its 105k, and end of 2028 its 115k. That's what I mean by it's not unrecoverable yet, I think its fairly likely we get back to above 115k by the end of 2028 which would make STRC as a whole accretive (even though some tranches would be dilutive below 187k.) and THAT is why it matters what bitcoins CAGR is.

CommercialDuck7496

That was not false! We are actually agreeing here. you already understand the mechanism, and explained it well. You just highlighted the inverse of what I was saying, not realizing the mechanism also applies in the other direction (which is what I was saying before). In the same way that issuing common stock above 1x net mnav can be accretive to net SPS today, and dilutive later if bitcoin rises, issuing STRC can also be net dilutive tdoay, and and net accretive later when bitcoin goes up. A simple example Say Strategy issues $100 of STRC but only receives $90 because it is issued at a 10% discount. They use that $90 to buy Bitcoin at $100k. They acquired 0.0009 BTC, but created a fixed $100 senior claim. At $100k BTC, that $100 claim is equivalent to 0.001 BTC. So initially: +0.0009 BTC acquired − 0.001 BTC-equivalent claim = −0.0001 net BTC Net SPS went down. By your framework, the issuance was initially dilutive. But now Bitcoin doubles to $200k. The 0.0009 BTC they bought is still 0.0009 BTC, while that same fixed $100 STRC claim is now only equivalent to 0.0005 BTC. So now: 0.0009 − 0.0005 = +0.0004 net BTC The exact same issuance that was net-SPS dilutive at $100k has become net-SPS accretive at $200k without Strategy issuing or buying anything else. Obviously, dividends raise the actual break even price, so I'm not saying every STRC issuance is profitable at $200k specifically. The point is that the result is not permanently locked in at the bitcoin price when the financing occurs. STRC creates a fixed dollar senior claim while the asset purchased with it is bitcoin, so the bitcoin equivalent burden of that claim falls as Bitcoin rises. A cleaner example would be something like this: Assume Strategy issues $100 of STRC at par and uses the full $100 to buy Bitcoin at $100,000, acquiring 0.001 BTC. At issuance, ignoring dividends, that is exactly net-SPS neutral because the 0.001 BTC acquired is offset by a $100 senior claim worth 0.001 BTC at that price. Now Bitcoin falls to $60,000. The 0.001 BTC is still 0.001 BTC, but the $100 STRC claim is now equivalent to 0.001667 BTC, so the tranche appears net dilutive. Then assume STRC costs 12% per year for two years, or $24 in dividends, and Strategy funds those dividends by selling Bitcoin at an average price of $60,000. That requires selling 0.0004 BTC, leaving only 0.0006 BTC attributable to the financing. At $60,000, the tranche now looks deeply net dilutive: 0.0006 BTC of remaining assets against a senior claim equivalent to 0.001667 BTC. Gross SPS has also fallen because Bitcoin was actually sold. But if Bitcoin later rises to $200,000, that remaining 0.0006 BTC is worth $120 while the STRC claim is still only $100, or 0.0005 BTC at the new price. The same tranche is now net accretive by 0.0001 BTC. Its exact break-even is about $166,667 BTC. So a tranche can be net-SPS dilutive today, pay years of dividends, even force Bitcoin sales at lower prices and reduce gross SPS, and still become net-SPS accretive later if Bitcoin rises enough. That is why saying the tranche is “permanently at a loss regardless of Bitcoin’s future price action” does not follow from the fact that it is dilutive at today’s Bitcoin price. That's exactly why I said being accretive in bitcoin/SPS at a particular point in time is different from being economically profitable in dollars over the life of the financing. Your argument demonstrates that net SPS is price dependent. It doesn't demonstrate that an STRC tranche which is net dilutive today is “permanently at a loss regardless of bitcoin's future price action.” In fact, the price dependence you described is precisely why that conclusion is incorrect.

WillingCurrent3663

You don’t get it. The people who invest in $STRC don’t want Bitcoin and they don’t want amplified Bitcoin in $MSTR. They are fixed-income investors who hurt want a high yield. It’s the largest liquid capital pool in the world, which is why Saylor sells $STRC to that massive market to accumulate more capital to buy Bitcoin with. The people who buy $MSTR are the ones who believe in Bitcoin. And they buy $MSTR vs Bitcoin because they understand the mechanics and that it’s a leveraged play on Bitcoin that outperforms BTC in bull markets.

Hfksnfgitndskfjridnf

The stock would have appreciated more if they kept their original Bitcoin stack and didn’t issue STRC at all. MSTR share price can still rise if Bitcoin rises. That doesn’t mean issuing STRC was good for shareholders. They’re better off if MSTR just kept their original stack.

Laukess

I don't understand why this doesn't push away MSTR holders. Have they fully pivoted to STRC now? My expectation was always that they would be buying on the way up, not the way down, as that's where they can borrow the most money. But now they're also selling the bottom.

Personal-Ebb-4717

if he can't get it to 100 buying back STRC. What make you think it will hold at 100 once he start selling STRC.

Hfksnfgitndskfjridnf

It doesn’t matter for the tranche of STRC they’ve already sold if you’re trying to calculate if issuing STRC is long term accretive. The tranche they’ve sold has already resulted in less Bitcoin per share than what they had prior to issuing it, so it’s already permanently at a loss regardless of Bitcoins future price action.

Hfksnfgitndskfjridnf

1.2 is just for STRC.

Hfksnfgitndskfjridnf

The cash reserve is for paying the dividend obligations. It’s already earmarked. It’s really simple: They issued STRC and bought BTC with it. They told us how much that increased Bitcoin per share by. Now Bitcoin per share is less than what it was before they started issuing STRC. This means STRC has permanently decreased their Bitcoin per share from what they’ve issued so far. Future issuance can increase it again, but what they’ve already issued is now at a permanent loss.

Hfksnfgitndskfjridnf

> The only distinction is that if bitcoin is down or flat for many years in a row, then eventually the bleeding of bitcoin becomes nearly unrecoverable at some point This is the point I’m making. It’s already happened, it’s unrecoverable after just a year. And it happened because they executed incredibly poorly. They issued STRC IPO at $90 and bought BTC at 117k But they then raised cash to support the dividend after BTC had dropped into the 60k range. This means they’ve already lost Bitcoin per share on the STRC IPO, which means it doesn’t matter what BTC compounds at, they already have less than they started with. Can future STRC issuance grow Bitcoin per share? Yes, but the current batch they’ve issued is already a detriment to Bitcoin per share and will keep decreasing it forever.

Doctor_Fritz

People here just posting memes. The company utilized the money of this BTC sale to manage ongoing corporate financing requirements, notably making preferred stock dividend payments and covering financing costs. They are also repurchasing shares (such as its STRC preferred shares) as part of a broader shift to adjust its capital structure and bolster cash reserves. While Saylor has famously championed a "never sell" mentality for individual investors, he has clarified that his personal stance is distinct from a publicly traded company's treasury strategy. Strategy's updated treasury framework allows it to leverage its massive Bitcoin reserves as liquid capital when necessary to support corporate operations, manage cash flow, and service security holders. They retain a large cash reserve to prevent liquidation.

RUYYRUYY

If Bitcoin doesn't appreciate soon, the MSTR vs STRC investors are going to go to war.

CommercialDuck7496

No the goalposts dont keep moving, the goal is to increase the BPS. but them being down for a quarter or year while bitcoin is in a bear market doesn't mean they're failing. Same way the goal of buying bitcoin is to increase your purchasing power over time, well there is a year in every cycle where that isn't true, it doesn't mean bitcoin isn't working. You just have to zoom out a little bit. Them not achieving the goal *right now* doesn't mean they are doomed to never achieve the goal. Also you have to put the drop in SPS in context because most of it isn't strictly because of STRC or any of the prefs. Even assuming an mnav of 1, they pay like 1.8 Billion a year in dividends, against 54 Billion in bitcoin, that would be 3.3% dilution per year if it stayed like that, not the like 10% we've seen over the last 2 months. If they didn't raise as much cash, they would still hsve a higher SPS than when they started strc, they would have needed to raise the cash anyways to pay the 6 billion in bonds due in 1-2 years anyways, they just pulled the drop in SPS from having to pay back the bonds forward. In the meantime that also has the benefit of improving the confidence in the prefs. But this cash was going to need to be raised anyways The whole point of my response was to point out, that if the bitcoin price recovers the BPS will recover too. In the long run, if bitcoin grows at 20%+ annually, STRC is a good thing for strategy, and accretive for mstr. That doesn't mean there will never be a year where they are down.

RUYYRUYY

He did, but when STRC lost the "par price" of 100 and he knew the dividend investors would flee if he didn't bring it back up so he was forced to buy back shares or have his whole scheme fall apart.

Oheson

What don't you understand about STRC being a Wall Street company vs. and individual? Do you think they have the same cares, concerns, or objectives? Comparing apples to oranges in order to either justify your Alt coins or just another Buttcoiner will not make it true.

Oheson

STRC is a company, not a person. Two different objectives. Saylor has never sold any of his personal BTC.

GilbyGlibber

I thought he started STRC to fund BTC purchases, not the other way around 

Hfksnfgitndskfjridnf

Because they already have less Bitcoin per share than before they started selling STRC. That means STRC is already a failure for shareholders. The whole point of issuing STRC was that Bitcoin would grow faster than the dividend payments so you can increase Bitcoin per share. Since they bought BTC at 80k+ and waited until it dropped to 60k before raising 3 years of cash reserves, they’ve actually decreased their Bitcoin per share. So it doesn’t matter what Bitcoin grows at from this point, it’s already a net loss. All that Bitcoin growth does is decrease how much more they lose.

Hfksnfgitndskfjridnf

Because they already have less Bitcoin per share than before they started selling STRC. That means STRC is already a failure for shareholders. The whole point of issuing STRC was that Bitcoin would grow faster than the dividend payments so you can increase Bitcoin per share. Since they bought BTC at 80k+ and waited until it dropped to 60k before raising 3 years of cash reserves, they’ve actually decreased their Bitcoin per share. So it doesn’t matter what Bitcoin grows at from this point, it’s already a net loss. All that Bitcoin growth does is decrease how much more they lose.

didnt_hodl

everybody was saying BTC will tank if they start selling. well they are selling it regularly now and BTC price could care less similarly, once STRC gets a proper credit rating (in view of the huge BTC collateral and giant USD reserves), there will be no need to pay a crazy, junk bond level interest of 12%. eventually, in the limit, STRC dividend will be only slightly above the risk free rate. and it would still be popular, since the dividend is also tax-deferred or essentially tax free for the first 10 years or so

stramoni

Just temporary bear market noise. It's pointless to conclude about STRC now. it's like complaining about the weather in a specific season.

anonuemus

I don't really see the problem with Saylor. He made mistakes like we all did at some point (buy high, sell low). Yes, STRC is borderline, but in general he aligns with bitcoin and if bitcoin keeps going on, like many of us believe, then MSTR will be good in the future. Even if he somehow fucks this company up, the interest in MSTRs bitcoin is still there.

Less-Information-256

Bitcoin per share has gone down since the launch of STRC and now has a guaranteed drag on it. He leveraged people overpaying for the common stock who are all miserable that they overpaid for it now and won’t again.

Legitimate_Form5449

2026.08.10. STRC-94 usd and 35 cents Michael says ChatGPT helped strategy raise $15Billion for bitcoin purchases source: yahoo!finance

Less-Information-256

You’re acting like they have no autonomy and can’t control if STRC for example was managed way better. They are free to make better decisions than they have, but are seemingly incapable. If you think strategy have maximised the shareholder value in their bitcoin treasury model in the last few years then good luck.

Less-Information-256

They started STRC with an over $2billion buy at $117k bitcoin and STRC stock sold for $90. You can’t flex a buy at a discount without considering the really basic fact of how much more discounted your funding source is. In any case I don’t know why you guys think there’s gonna be huge buyers for a stock at $100 when they’re struggling to find any for it at less than that. 200k bitcoin might be great for them but remember their average buy price of bitcoin with STRC is wayyyy higher than their overall average buy price.

cassydd

Bought STRC at $85 after the first purchase. Been a nice little earner so far.

Hfksnfgitndskfjridnf

He banned me from MSTR and blocked me. Doubt he’s coming into this thread. Basically called me a troll for suggesting that even if you think BTC can grow dramatically in the long term that STRC had still be a drag on common shareholders. Which after only 1 year is already true. It doesn’t matter how much Bitcoin increases per year from here on out, the damage STRC has done to common shareholders can’t be recover. Common shareholders have lost Bitcoin per share because of STRC already and they are still on the hook for 1.2 billion a year. Bitcoin per share will keep dropping forever based on the STRC already issued.

macready26

Get into MSTR preferred stock STRC pays 12% dividend yield monthly or Strive ASST pays 13% daily dividend. That way you can still participate in Bitcoin

ALth0r

They are not gonna manage STRC. At the moment it's propped up by selling btc or with share dilution, so at the cost of MSTR shareholders whom will lode confidence in the product with time if it keeps happening. STRC was a terrible idea. I don't need complex structure to understand that giving interest from something that doesn't generate interest is a terrible idea.

UC_DiscExchange

They've sold roughly 2% of the Bitcoin they bought via STRC. Their sales are fairly insignificant in actual value, but are significant in messaging. I don't have an average of their STRC buyback price, but they started in $80s. If we assume $85, that's ~17% gain at par value. A 17% increase in Bitcoin price is nearly exactly their Bitcoin acquisition price. I think these sales have been a negative as of now, but when you consider the potential growth that 200,000 more Bitcoin can provide it has a clear opportunity for STRC to have been overwhelmingly positive on the whole. We just have to wait and see if Bitcoin actually recovers in the next few years.

Hfksnfgitndskfjridnf

Whether he has to 12% or not, that’s what he IS doing. Whether he has to keep cash reserves or not, that’s what he IS doing. And he can’t lower the div to 3% tomorrow anyway, they can only drop it .25% a month plus a little more if fed changes rates. So based on what they are actually doing, issuing STRC is worse than issuing 0 coupon convertible notes. And it doesn’t matter what Bitcoin compounds at, in worse under all scenarios.

BigDiperEruption

One STRC is back at par they will buy those bitcoin back before breakfast. Their only goal is to get STRC back to par

Argyrus777

Did all that and STRC still went down

didnt_hodl

he does not have to pay 12%. all dividends are voluntary, rate is set by him. the minimum rate is around 3% (risk free) he does not need to hold any cash either, that is also fully voluntary the idea is simple: you sell $1B of STRC. and that is a final sale. zero debt generated. no need to pay anything pack or to buy back. you just get $1B of cash. immediately buy $1B of BTC now, as long as BTC appreciates faster than the dividend rate that you get to choose, and faster than 3% per year on average., you are permanently ahead on that trade with the bonds you have to return what you borrowed. and the terms of the deal cannot be changed or altered after the sale. with STRC he can set the interest rate to risk-free tomorrow. he can also skip some dividend payments altogether. that's the difference

HSuke

> husband in denial after walking in on his wife with another man No kink shaming. Some MSTR holders enjoy the cuck chair watching STRC get buybacks.

UC_DiscExchange

I disagree as it depends on how STRC continues recovery. They bought it back at a discount and will without a doubt reissue those shares at par, which would net them both gain on those STRC shares and more Bitcoin with little to no dilution. It's far too early to make a determination one way or the other.

Hfksnfgitndskfjridnf

And they added 110 million common stock shares, 316m to 423m. If they are better off financially now, that is the only reason, issuing STRC is not it.

Hfksnfgitndskfjridnf

It’s worse than that. You didn’t mention building a 3 year cash reserve after BTC has already tanked. They basically have the same Bitcoin per share today that they had prior to STRC IPO (198k Sat/share vs 191k prior). So they got absolutely nothing out of issuing STRC Bitcoin wise and now owe 1.2 Billion a year in dividends forever. STRC has been an epic disaster for shareholders, and they want to issue MORE!

Hfksnfgitndskfjridnf

It’s worse than that. You didn’t mention building a 3 year cash reserve after BTC has already tanked. They basically have the same Bitcoin per share today that they had prior to STRC IPO (198k Sat/share vs 191k prior). So they got absolutely nothing out of issuing STRC Bitcoin wise and now owe 1.2 Billion a year in dividends forever. STRC has been an epic disaster for shareholders, and they want to issue MORE!

Hfksnfgitndskfjridnf

Convertible bonds are way better than STRC. Getting a 0 coupon convertible with a higher strike price than the current stock price that doesn’t come due for 3 years is infinitely better than paying 12% a year forever and having to hold 3 years of cash against. Just do the math. Issue 1 Billion of converts and buy 1 Billion of BTC. You have to equitize or pay back the debt in 3 years. Or Issue 1 Billion of STRC and buy 640 million of BTC. You have to pay 120 million a year forever and earn 4% on 360 million in cash. Use whatever BTC growth rate you want, convertibles always come out on top even after you pay it all back.