STRC

Good-Book-6912

According to Claude there is some minimum percentage that will accumulate to STRC holders. The company can choose not to pay for a while, but arrears still accumulating yearly at minimum the secured overnight financing Rate.

devCheckingIn

Looks like STRC's new par value is like... $85.

ReliantToker

Over the last 6 months STRC has a return of -7%. Spot bitcoin -31%. STRC is an income investment and should not be compared. It is intended to funnel money into bitcoin that otherwise would not enter the network. The risk profile and target audience are completely different.

BitcoinBaller420

45% MSTR 5% MSTR leaps 30% STRC 20% STRK 110% economically long bitcoin. 0% sovereign, but looking forward to being there one day, maybe when the world stops being so stupid and forcing me to buy strategy's stuff bc they can't do simple math lol

Venij

I don't know what you mean by "convenient metric". Isn't it just the most accurate assessment? It's published on the Strategy website and has been there for quite some time. Strategy has tried to give an opportunity to have a mixed risk/reward portfolio within their own product offering. Basically, betting a very large bank on "We and many investors know bitcoin will have >20% rate of return over the next 25 years. Not everyone can tolerate the volatility. Let's capture that value by providing a mixed bag of risk and reward" * STRF — 10% fixed return, most senior so highest chance of getting your money back if Strategy goes belly-up * STRE — STRF for europe * STRC — ~12% variable, monthly payout (the rest are quarterly), $100 par (NOT $100 pegged price). Yes, higher rate than STRF but less senior. Strategy is trying to pull in money that would otherwise be invested in money markets or whatnot. * STRK — 8% fixed, convertible into 0.1 MSTR shares — yield + BTC upside optionality * STRD — 10% fixed, most junior preferred. I suppose this could be an alternative to STRF, but this product probably doesn't make sense * MSTR essentially mimics bitcoin price, has no "return" in interest / dividends, and has lowest seniority. As much as STRC is a burden on mNAV, it also does not reward those holders in times of BTC gains and instead pushes those gains over to MSTR holders.

No-Masterpiece2246

That's a convenient metric. I thought STRC was designed to stay at $100 and they'd buy more BTC anytime it went over that price? So if anything, STRC is just a burden on mNAV and MSTR share price too.

gushkaper

Chill, just wait a while for BTC to regain traction? Then everyone will be a genius again and STRC at 100$ Probably in a couple of months.

HSuke

Diminshing returns and investors learning from the past that high mNAV is absolutely insane. Investors are less likely to make the same mistakes on an old product. With STRC dividends and selling Bitcoin, this is probably the final nail in the coffin for mNAV as a KPI. Microstrategy itself has already shifted to BPS ad the primary KPI.

Local_Math_5512

It's pretty simple. I don't know why so many people struggle to understand it. In simplest form, MSTR sell's STRC for $100 each. They keep enough USD to pay 17 months of dividends ($17). MSTR uses the remaining $83 to buy BTC. Maintaining confidence in the instrument of STRC encourages more people to buy STRC. This raises more USD for MSTR to buy more BTC. Selling BTC to keep confidence in STRC means less BTC for MSTR in the short-term, but much greater BTC in the long term as STRC will continue to raise USD for further BTC purchases.

etaoin314

but will it? the last few years have not been too promising in that regard. The early part of the run up carries all the weight in these predictions, while we may reclaim 100k I am having trouble seeing a catalyst that gets us past that. I do think MSTR was a big part of the last run, and I just dont seen them being able to attract that kind of capital going forward, at least for a while. I think STRC would have to reclaim par and stay there for several months/years before that becomes a viable source of income for them again.

Strange-Term-4168

STRC is a dumb fucking idea and will be the downfall of strategy. How the hell can you expect a 12% dividend to be sustainable?

Less-Information-256

Financial analysts are loving selling bitcoin at a loss? So far it hasn’t achieved what was presumably their goal which is to bring STRC up to par, it’s still miles off and barely moved on this news.

DrkZeraga

I dont think that applies to STRC

fintechjunkie

STRC > US Treasuries

Potatotornado20

STRC

frugaleringenieur

Congrats, $MSTR and $STRC up 1% over the day. You can only measure Bitcoin strategies in 5 year intervals.

ahhhaccountname

Regardless, I dont like him impacting the crypto space. He builds these "instruments" to juice out the hype for BTCs longterm success. Encouraging people to load up on shit like STRC for "guarenteed" 10%+ yearly dividends. Having shit like this doesnt add value to the BTCspace, but extracts from it. Sure he can temporarily inflate the price by loading up through funds pumped into STRC or selling his common stock, but this is all just for a temporary pointless pump. For instance, if all this money put into STRC was instead put into BTC, there wouldnt be some additional obligation to pay out dividends. It would just be more BTC holders. His BS "instruments" act as a leech on BTCs success

joefunk76

With ~845k bitcoins, Saylor can sell 3,588 bitcoins 235 times before he runs out of them. It’s not a big deal if he has to do this for a few quarters before the bear market turns around, and he regains the ability to sell STRC and MSTR to fund the dividends. Your whole argument is little more than a long-winded tirade of pearl clutching.

Kryptonite0x

They just have to remove STRC from the supply and that’s it. STRC was a stupid idea

gushkaper

Great news for STRC.

johnnyBuz

If selling some BTC gets STRC back to $100 then he will buy back that BTC in short order (and pad the reserve in the process).

KifDawg

STRC was such a stupid idea. They literally bought every top and are now selling the bottom

cooltone

Retire is a loaded label. Let's just say you have enough money to give up your job and have enough money to live (accommodation, clothes, food), nothing extravagant. Then what? There's an interesting chapter in an old book, I'm OK, You're OK. One of the biggest problem people have is how to fill the next hour of their life. So much so that we all create rituals and habits to relieve us of making those decisions. Once you give up everything in your old life, you will need to build a new one. What is your vision for it? On a financial note, I would wait a couple of years E3Q/2029 - the most likely time for the next peak, then cash out what you need for living expenses. STRC/Strategy looks interesting for a no hassle income. And in that time you could plan your new life.

Nick700

they have more than a year of dividends in cash and none of their bonds are due within anywhere near 3 months, so idk what could make them go under that quick. Big players can send the share prices lower and lower, but there isn't some price that kills the company if they drop below it, for STRC the dividends are fixed and if they can no longer sell MSTR either due to capital markets forsaking them they would still have 800k btc to sell before they would die off entirely

highspeed717

Big banks are 100% threatened by STRC and would love nothing more than see it fail.

pythosynthesis

Pathetic attempt to dismiss OP's point. WallSt is a group of people who talk and who have the power to move markets. The traders in giant banks, to be clear. And they smell blood with MSTR/STRC and are indeed attacking them. You may have heard something a about WllSt smelling blood and similar stories.

pythosynthesis

You're onto Something OP. WallSt is smelling blood with STRC/MSTR and you know what that means. They don't want money from buying BTC cheap, but from STRC/MSTR stock in the gutter. And they're attacking their funding, not so much BTC. If STRC/MSTR cannot run the business because funding is too expensive, they'll need to sell coins to pay for it. And the recent sell of a handful of coins was the canary in the coalmine.

Kitchen_Catch3183

Yesterday, dumbest people alive were celebrating Saylor’s plan sale of Bitcoin as “genius” because MSTR/STRC went up. Where will they be today?

EasyPleasey

The rise to 100K had the following catalysts: 1) MSTR buying billions every chance they got 2) The election of a "pro-crypto" administration 3) Institutional ETFs, allowing boomer money to buy BTC 4) The rise of Stablecoins 5) The worst inflation in the last 40 years 6) And most importantly, the backdrop of a 13+ year bull run (minus a blip in April 2020) What else is there? You have to have more people buying into bitcoin for it to go up, that is the cold hard truth. Now: MSTR has cratered, STRC is looking incredibly unstable, and the only way out for them is to dump their bitcoin. Trump is 2 years in and really only cares about grifting (Trump coin) and the EU has halted a crypto exchange. We could easily see an anti-crypto candidate emerge in the US. Institutional money, who were already skeptical of bitcoin and don't understand it, have now been roasted, all while watching index funds do what they always do, deliver returns. They are not going to come back. Stablecoins are still around, but if some of these companies get audited things could go sideways fast. Inflation is much more inline with where it has been almost all of my life, you can't tell people their fiat is evaporating at 13% anymore. If the markets finally cool off, and I suspect they will if you look at the Shiller PE ratio, stocks are overvalued at almost the peak dotcom boom, many people (not bitcoin diehards, but the people that have bought in and pushed it up this much) are going to sell anything that is risky and retreat to safety. The fact that it has cratered like this during a bull market is a terrible sign.

Leithm

STRC is still selling below par, and it doesn't work while it does, how much will it cost them to get it back there?

Romanizer

STRC increased by $9,1 (+12%), so that was seen as a good move by the market. Now they are roughly back to where they started. The 4% is also assuming they don't sell any ATM stock or preffereds anymore at all during the next 30 years or don't get any convertible debt. They recently raised about $300m while at the bear market bottom and the recent publication hints at much more coming. But yeah, if Bitcoin doesn't move up for decades and suddenly they don't get any of the infinite fiat money available, they could run into problems somewhere around 2050-2060. Which would also mean Wall Street and all governments in the world would have to stop everything they are doing to adapt to Bitcoin before it is too late.

TrainingQuail543

Because if you buy MSTR you get the money from the STRC investors for free. They get 12% dividend, if Bitcoin does 20% the other 8% is added as value to your MSTR stock. If you buy an ETF you don't have that effect. In theory that is leverage with a low liquidation risk. To make a simple example: There are 10 MSTR shares. Each is worth 100$ You buy one Share for 100$. After that 10 people buy one STRC each for 100$ The value of one MSTR shares is now 200$ but the company has to pay a dividend of ~100$ per year.

Leithm

>Nobody with half a brain would bet that Bitcoin is not growing by an average of 4% over the next 30 years. That is quite and assumption, as it is down from the peak over 5 years ago. It's only limited to 4% because they haven't sold any more preferds. That is their only significant business now we have to assume they want to selll more. If they do they just increase their liability above the risk free rate. He increased the interst rate on the preferds yesterday from 11.5 to 12% to try to juice demand but it is still trading well below par. If they carry on burning money to raise the rate this just unravels faster, if STRC gets back to par and they sell more of it that just increaeses the liability.

MelangeBot

They don't have to pay dividents, it's optional. They can decide to pay nothing anymore and it's legal. That will crash the price of STRC to zero but if they wanted they could do it.

MECO-420

With 17 months of USD in reserve to cover the dividends, if they sell BTC now, its to buy back STRC or MSTR at a discount. Why shouldnt Saylor buy back STRC at $80 or $90 when they sold it at $100?

DiddysAfterparty

Please save STRC

usrname_chex_out

Tbh I agree if I had to guess we go lower at least one more time, idk if that’s this week or October or some other time. The whole MSTR/STRC thing is nice to see though cause that’s definitely the kind of stuff that happens near bottoms. Maybe the bottom happens when they sell 1B worth of btc to cover dividends? Still 58-62k was good enough for me and I put in about half to 2/3rds of what I want to get in

HSuke

It's $1.25B on top of another $1B for STRC buybacks and $1B for MSTR buybacks. So about 55000 BTC total.

HSuke

I don't think I've ever seen anyone talk about STRD. A few people talk about STRK and STRF, but even those are super rare. Just mostly STRC.

PopLegion

Bears making liquidation event scenarios is retarded yes. What is much more likely is MSTR becomes a perpetual seller of BTC for years on end as they never recapture 1.0 mnav, and BTC needs to deal with a constant downwards pressure for years. If saylor can't raise money through ATM offerings of MSTR or STRC, 1.5 billion a year minimum of selling from saylor. Def worth keeping in mind if you are long BTC. As for MSTR and STRC investors today, I feel sorry for them. I'm sure many made money, but the ones left will become bagholders.

HipOut

You clearly are because you’re posting in here and raging at everyone like a angsty teenager. I’m much more comfortable owning bitcoin instead of STRC even if I do miss out on any short term gains. I’m not a swing trader I’m a HODL’er. If you’re such a saylor fan boy you’d realize he supports all different type of people being able to do all different types of things with bitcoin, leverage, short, hold, etc which is why he has created so many different financial instruments This whole infighting is lame af. It’s cool what saylor is doing for Bitcoin but some also think it sucks and that’s fine too. At the end of the day Bitcoin doesn’t need saylor. Doesn’t need Lyn Alden doesn’t need Brian Armstrong doesn’t need anyone.

BitcoinBaller420

lol you already said that rookie. I've seen a thousand of you. Think of me when STRC rips again. I won't think of you at all.

wolfenstein734

Im assuming they sell BTC to buy back STRC then resume buying BTC by issuing MSTR?

devCheckingIn

They already announced a 12% dividend. Both STRC and MSTR are up +13% today so I think the market took the news well.

OkRip7540

>one of the criticisms from the rating agency S&P was that they were committed not to sell any Not quite, the concern was "currency mismatch" - Strategy claimed BTC as a liquid currency reserve but S&P disagreed and gave them a "junk" rating. S&P couldn't care less about willingness to sell or buy BTC, they care about the end state of the balance sheet and Strategy has been carrying low cash reserves for a while and that presented as a risk. Bringing cash reserves up to $2.5 billion helps to bring their balance sheet in line with modern risk thresholds - how they fund that cash raising effort is entirely up to them. Strategy doesn't need to sell BTC to fund cash reserves, they can sell equity via MSTR or STRC to do so

fan_of_hakiksexydays

They already had to raise the dividend on STRC from 9% to 11.5%, and will either have to dilute MSTR even further or raise the dividend even more. So whatever cash they had for the next 2 years, is getting depleted quicker than expected. Not that 2 years looked like it was gonna be enough anyway. People are still abandoning ship and not willing to come back, so that 2 years narrative wasn't enough to inspire confidence.

BitcoinBaller420

I told you to sell Bitcoin and buy STRC... massively outperforming Bitcoin feels good when you're on a Bitcoin standard, and you get to do it holding very safe CREDIT, with decades of existing reserves and portfolio diversification benefits. Those privileges are still available by the way, STRC below $99 is just a retail-driven market inefficiency being corrected in real time. And STRC is 100% effective-btc exposed, unlike say an option which is fractional exposure. Institutions will buy it back to $100 soon enough, there's $300T out there that would be better allocated in STRC and only a few billion of it in existence, never mind it's the biggest and most over-capitalized version of this product. You can front run it, or not.

ZUU_Music

*"They need to sell BTC to save both MSTR and STRC from plunging even further"* The irony.

cptcolo0

MSTR stock is up 13% today, STRC is up 12%

BitcoinBaller420

No. The reason is that the returns from the credit are far too strong to justify a 100% capital portfolio even for someone on a bitcoin standard… except for those who are all in on self-sovereignty, which in a cruel twist of fate, is all the early INTJ-adjacent adopters of Bitcoin lol.  Assuming your goal is buying power appreciation, a mix of Bitcoin, STRC, and MSTR will create a significant improvement for return on risk over an asset that already shines in this department.  Good luck to you. 

HSuke

MSTR was mass banning everyone. That's why the r/STRC sub grew.

HSuke

All their shareholders were pissed off they kept diluting MSTR, and their STRC shareholders were pissed off they were letting it free fall without any communications or long-term cash reserve. Today's announcement was the most sane and self-preserving thing they've done in the past month. They need to sell BTC to save both MSTR and STRC from plunging even further.

HSuke

Thank god they finally listened to reason after clowning around for the past month. All their shareholders were telling them to stop diluting MSTR and stop letting STRC free fall. Selling BTC was inevitable if they didn't want their share to crash even further.

devCheckingIn

STRC about to break $80. 😲 Is the bull run here? 🤔

nafnaf0

MSTR investors are well aware of this already. If you follow their statements and earnings calls, this comes as no surprise. I have seen a lot of people arguing otherwise, or saying other non-sense like they will just not pay the STRC dividends as opposed to selling the BTC if needed.

Jaykalope

You realize Saylor is on video saying he built STRC by going back and forth with AI, right?

CompetitionDouble420

Meanwhile, I'll continue mining BTC quietly in the background while watching the retail guys quarrel over MSTR/STRC and BIP110 🤙🏼

coully95

Just wait until markets have to start pricing in Saylor's creditors executing their puts in September 2027. He'll have to sell some of his stack to raise the capital. The bottom isn't in until Microstrategy has deleveraged and STRC is at $0.

GregS73

Saylor STRC and MSTR are here to stay.

snek-jazz

You need to factor in bitcoin bought from STRC

_Stylite

Ok, and Michael Saylor talked to an LLM for one afternoon to build one of his main products STRC which is now failing and could bankrupt his company. The chat bot even told him it had never been done by anyone before (wonder why!) and Saylor built and launched it anyway…

PaulPaulA333

His STRC ponzi/scam has ruined the finances of many retail investors who trusted his false premise that it was like high yield money market and he seems to think its all a big joke.

HSuke

Stop making strawman arguements. He didn't say death spiral. They can have downward spiral that wipes out most of the value for half a decade without a full death spiral. Pausing dividends is the death of STRC. No one will ever trust them again. It won't completely kill MSTR, but it's practically just as bad.

PopLegion

mnav is below 1.0, STRC is trading 25% below par, and MSTR only has about 10 months of cash burn till it cannot service its dividend payments without additional capital raise or financing. Not to mention 1 billion in senior convertible debt hitting maturity in 2027. buying more BTC here is borderline a breach of his fiduciary duties

Jumpy-Imagination-81

>But the \~$1.2B/year in preferred dividends still has to be paid regardless. No it doesn't. Strategy can suspend or reduce the dividend for 120 days according to Saylor. That's generally true for dividends, the company is not obligated to pay dividends, and many companies have reduced or suspended dividends. Of course if Strategy did that everyone who bought STRC for the dividend would dump their shares, cratering the price of STRC. This is from the STRC prospectus, which all potentiual STRC investors should have read before investing in STRC, but of course they didn't because they were too busy replaying the AI generated video of the bikini-clad "engineer" who was "retired" and living off STRC. >Our current intention, **which is subject to change in our sole and absolute discretion**, is to adjust the monthly regular dividend rate per annum in such a manner as we believe will maintain STRC Stock’s trading price at or close to its stated amount of $100 per share. **We may, at any time in our sole and absolute discretion, and without the consent of any preferred stockholder, choose to reduce the monthly regular dividend rate per annum to the maximum extent permitted by the terms of the STRC Stock, without regard to the impact that reduction may have on the trading price or value of the STRC Stock.** >**If we reduce the monthly regular dividend rate per annum, then the trading price or value of the STRC Stock could decrease significantly. If you hold STRC Stock at the time of such a decrease, the value of your investment could materially depreciate, and you may not be able to resell your STRC Stock at favorable prices, if at all.** Moreover, the mere existence of our right to unilaterally reduce the monthly regular dividend rate per annum could, in itself and without any actual reduction in the monthly regular dividend rate per annum, cause the STRC Stock to trade at prices below those that may otherwise be expected. >Notwithstanding the limitations on our ability to reduce the monthly regular dividend rate per annum, **the trading price of STRC Stock could decline significantly if, for example, we reduce the dividend rate in successive regular dividend periods, or there is a market expectation that we do so. Further, consecutive monthly reductions of the regular dividends rate on the STRC Stock may cause the regular dividend rate on STRC Stock to be viewed as reasonably expected to decline, which could result in adverse consequences to holders of STRC Stock.** See “—The tax rules applicable to “fast-pay stock” could result in adverse consequences to holders of STRC Stock” below. If we reduce the monthly regular dividend rate per annum to the minimum dividend rate of the monthly SOFR per annum, and the monthly SOFR per annum thereafter increases, we will have no obligation to increase the monthly regular dividend rate per annum to the new monthly SOFR per annum. Moreover, SOFR has a limited history, and its future performance cannot be predicted. >**We may not have sufficient funds to pay dividends in cash on the STRC Stock, or we may choose not to pay dividends on the STRC Stock. In addition, regulatory and contractual restrictions may prevent us from declaring or paying dividends.** >We expect to fund any dividends paid in cash on the STRC Stock primarily through additional capital raising activities, including, but not limited to, at-the-market offerings of our class A common stock and our junior preferred securities. However, our ability to declare and pay cash dividends on the STRC Stock will depend on many factors, including the following: * our financial condition, including the amount of cash we have on hand; * the amount of cash, if any, generated by our operations and financing activities (including our ability to raise additional capital from the equity capital markets on favorable terms or at all); * our anticipated financing needs, including the amounts needed to service our indebtedness or other obligations (including any dividend payments we must make under our STRK Stock, STRF Stock or STRD Stock), which may be impacted by our ability to sell equity which is reliant on maintaining effective registration statements, certain market conditions, such as sufficient liquid trading volume for our stock, the market price of our securities, the value of our bitcoin holdings, investor sentiment and the general public perception of bitcoin, our strategy and our value proposition; * the degree to which we decide to reinvest any cash generated by our operations or financing activities to fund our future operations; * the ability of our subsidiaries to distribute funds to us; * regulatory restrictions on our ability to pay dividends, including under the Delaware General Corporation Law; * our ability to sell equity securities under existing or new at-the-market offering programs; and * contractual restrictions on our ability to pay dividends. https://www.sec.gov/Archives/edgar/data/1050446/000119312525165531/d852456d424b5.htm#supptx852456_5

PopLegion

I think there will very clearly be a case that saylor purposely misled investors when STRC blows up. I do not think his "legal and risk disclosures" are going to save him from the marketing STRC used.

UC_DiscExchange

While that is correct, it doesn't correlate to your previous comment. If anything STRC pausing dividends is good for MSTR holders because they then don't get diluted for dividends they don't receive.

nafnaf0

yep, BITP is going to give STRC & SATA some competition. Both have an effective AYP around 16.5% currently.

PopLegion

By this time this all unwinds and is facing scrutiny there is a real chance it will be a completely different SEC. We will see on that, it is definitely a big assumption. Realistically if he cuts the dividend STRC goes to sub 50.

UC_DiscExchange

They won't. The SEC are the ones who approved STRC.

Internet_is_tough

The terms and conditions and prospectuses and all submitted forms clearly specify that the dividend can be changed or suspended at MSTR's discretion. So suing them won't matter. It's clearly communicated. Even Saylor's AI promo videos mention this in the small letter screens. Obviously in that case the trust in STRC will collapse. It will go to near zero till the situation is sorted out. It's not something anyone wants, but it won't collapse the company

PopLegion

If they suspend the STRC dividend MSTR will be swimming in class action lawsuits.

Internet_is_tough

Claude tells you what you want to hear. The only thing that can collapse Strategy is their convertible dept. It's 6 Billion. In order for shareholders to be wiped out, the BTC they hold must drop at 6 Bn value at the time the dept matures. The dept matures in tranches but it's at about 2029, so let's just say 2029. They got 850k BTC. Let's say it all goes to shit and they cannot accumulate more. Let's also assume they will be paying the STRC dividend obligations by selling BTC. All that gives us a BTC price of 10k. So if BTC drops to 10k and stays there till 2029, shareholders will potentially be wiped out, since it will be quite hard for MSTR to refinance. However the proffered stock cannot collapse the company. They can reduce or suspend the dividend at any time. So practically the BTC must go a bit lower, like I don't know 6-7k. In other words the Fudders are idiots. Put this in your AI

Reason_Boner

I’m on a one year timeline as we will know more about the interest rate risk which for me is one of the momentum killers. Also after a year we will know how the STRC picture plays out especially if BTC sales are needed to keep the perpetuation yields ongoing.

fan_of_hakiksexydays

Looks like 50Ks might be about to be the new 70Ks. If it's the same old scenario, we might briefly dip into the 40Ks, then crab and hang around 50Ks for a while. Maybe even briefly rally back into the 60Ks after things settle. And just wait for the black swan event to finish off the bear market. AKA wait for MSTR and STRC to spiral down even more into total chaos.

chowsingchi

look at STRC, saylor is going to be sued big time.

h4l

They only sell new shares when STRC is trading at $100, they don't issue any shares when STRC is trading lower. (Which is a problem for them, as while STRC is under 100 they have to issue new MSTR shares, sell BTC or issue new debt).

h4l

They do, Strategy use at-the-market offerings (ATM) to issue new shares of STRC and MSTR in order to raise money. That's what STRC is for, it's their capital raising mechanism to raise money without diluting MSTR holders. Strategy has a broker-dealer that will sell new shares on the secondary market (e.g. to arb traders or anyone else buying) when they want to raise money. E.g. in April they sold $1.8 billion of STRC, and $1.5 in May in the days leading up to ex-dividend: [https://bitcoinquant.co/preferred-equity](https://bitcoinquant.co/preferred-equity)

peanutbutteryummmm

Or drop STRC rate. Then no accumulated dividend.

peanutbutteryummmm

Lower STRC rate instead of

peanutbutteryummmm

Even better, they can drop STRC rate to SOFR. Better because it doesn’t break character. Better because it actually might improve the price of STRC. The sell off isn’t the yield, it’s the fear of bankruptcy or whatever. Lower STRC and you lower the stress of the company significantly.

nafnaf0

Yes, they are allowed to do that, but I must add that it would be unlikely in the near-term environment: We may, at any time in our sole and absolute discretion, and without the consent of any preferred stockholder, choose to reduce the monthly regular dividend rate per annum to the maximum extent permitted by the terms of the STRC Stock, without regard to the impact that reduction may have on the trading price or value of the STRC Stock. We may be unsuccessful in achieving, or may abandon, our current intention of adjusting the regular dividend rate in such a manner as we believe (in our sole and absolute judgment) would be designed to cause the STRC Stock to trade at prices, or otherwise have a value, near its stated amount of $100 per share. We may not have sufficient funds to pay dividends in cash on the STRC Stock, or we may choose not to pay dividends on the STRC Stock. In addition, regulatory and contractual restrictions may prevent us from declaring or paying dividends. Our board of directors may choose not to pay accumulated dividends on the STRC Stock for any reason. Accordingly, we may pay less than the full amount of accumulated dividends on the STRC Stock.

hindumafia

That will only hurt STRC holders. Not the company or sailor, or BTC.

erecterect

When they suspend dividends, STRC will be worth pennies. Why anyone would invest in any of Saylor's scam companies in the first place is insane to me, but if he suspends dividends on a stock offering whose entire point was to pay dividends, how could anyone trust the management to invest in any of his many stock offerings orbiting mstr (including mstr)?

WistopherWalken

STRC will crash. 

h4l

I'm focusing on dividend arb and long-term holders to explain this particular dynamic, but yes there are other participants. E.g. STRC is safer to short than most stocks because the $100 ceiling means there's no unlimited loss. If you open a short at $100 after ex-dividend and aim to close before the next ex-dividend, you either break even if it stays at $100 or make money if you can sell below 100 on a drawdown.

ZealousidealMonk1728

STRC was pointless from the beginning. You get 10 % dividends but the risk was always WAY too high to justify buying when there are dividend ETFs which offer 3-4% +5-10 % course gain in most years.

LuckyWinds

> I don't even know what you're arguing with me about. You make no points other than to claim your own ignorance and defend Saylor and claim you aren't defending Saylor I never defended Saylor. Can you please stop making things up about what I'm saying. Just quote my comments and show me where I'm saying these things. > The disclosures fully indemnify every statement made by the CEO? MSTR bear no responsibility for any of this? No, No > What is your point? Anyone investing in STRC (or **any** financial product) should read the disclosures. The disclosures are **extremely clear** and **extremely concise**. I've already quoted them. They literally are front and center on the website I linked. They should not be listening to the CEO of the company and using their word as gospel. If Saylor said things that are illegal to say, he should be prosecuted. As of right now there is **no lawsuit** against him. If someone is unable to read basic, concise, clear disclosures. They should not invest in ANY financial product. They should hire a financial advisor. And as I already said, I would never invest in anything Saylor touches, nor would I recommend anyone to do so.

basketbun

Your thesis fell apart when you only had 2 stereotypes buying STRC, there are a few more buyers of STRC that you're not aware of

eddyblat

The prefs are not listed as debt on their balance sheets for a reason. They are friendly handshake IOU's at best. MSTR is the parent company, not STRC. MSTR survival is more important than pref survival. The prospectus says they can permanently suspend all dividends forever, their choice. The btc acquired through the ATM programs are unencumbered completely. If MSTR walks away from dividend obligations it makes that $10B or whatever of BTC almost free. Remember when META kept pumping with every layoff announcement? If MSTR announced a big giant FU to all preferred obligations they would drop to $50 pre market, $65 market open, and be $200 within 3 weeks. The market is forward looking. No debt, no dividends, $40B btc. Bullish af.

HSuke

Uhh, this post is 2 months too late. I brought up this same topic on r/MSTR 2 months ago. None of this matters anymore now that STRC is so far away from par and trading like a meme stock.

Logical-Recognition3

What's to stop Strategy from selling STRC at $100 and buying it right back at its depressed market value?

LuckyWinds

This is an investigation, not a lawsuit. I'll ask again. Point me to the lawsuits against Strategy for STRC and/or MSTR so I can see what exactly they are suing for and reply appropriately.

HSuke

If they stop paying STRC dividends, Microstrategy is dead. That's pretty much the final straw that will break all trust in Microstrategy. They have cash reserves to pay until early 2027. That's it. There are 6 convertible notes with put dates between 2027 and 2029. They are puttable before 2030. Exact value of all obligations before 2030 is over $13B. If MSTR starts paying off all those obligations, it will lose half of its value, and it doesn't have enough value to pay off $13B. So they will eventually need to sell BTC unless the bull market begins by 2028 to early 2029.

Strict-Employment664

Tbh I will always keep some BTC but I have some financial goals that would require selling a decent part of it, so I’m in wait hoping for some recovery north of 100k in the next year or two. I’m more kicking myself for having bought STRC and SATA with bonus money right before it all started to crater and am now also waiting and praying that goes back closer to par

pitchbend

But they don't need to sell to pay STRC dividends since those are optional and they do have enough cash reserves to pay the 2027 debt and the next is in 2030 so why does he need to sell "soon" or what am I missing here?

CryptoAnarchyst

My god, the level of ignorance is ridiculous. First your analogy of taking a loan to pay a loan… that’s literally how every wealthy person operates… so long as their equity is high, they can collateralize it and get a 1% interest loan on it, then just take out another loan when they need to pay off the first one. Secondly, they raised cash reserves using both MSTR and STRC issuance, and can do so by selling the bitcoin… not sure how you might be confused with that one… unless you’re not capable of rational thought

LuckyWinds

> Which infers no other statements by the CEO have no legal bearing nor the misleading statements I quoted to you from their own website have any bearing No it doesn't. > Yeah Google it dude. You think the disclosures are all that matter so I suppose the lawsuit is immaterial I'm having trouble finding active lawsuits. Point me to the lawsuits against Strategy for STRC and/or MSTR so I can see what exactly they are suing for and reply appropriately.

PureCod9290

>Look at the disclosures for STRC. That is the legal definition of the financial product Which infers no other statements by the CEO have no legal bearing nor the misleading statements I quoted to you from their own website have any bearing >Point me to... Yeah Google it dude. You think the disclosures are all that matter so I suppose the lawsuit is immaterial

LuckyWinds

> You've been arguing the disclosures are adequate to protect any misleading statements they've made. I never said this You keep saying I'm saying things that I never said. You've done this over and over again. Just quote my exact quote of my comment if you want to claim I said something. > Go Google MSTR shareholder lawsuits I'm done explaining basic corporate governance to you Point me to the lawsuits against Strategy for STRC and/or MSTR so I can see what exactly they are suing for and reply appropriately.