STRC

PimpNWallstreet

They are about to start paying STRC dividends bi-monthly (every 2 weeks), which will be a HUGE thing for STRC! ...look out for the announcement...btw Strc is a STEAL at today's current price

First_Driver_8492

Between STRC, Iran, El Salvador, and world powers buying bitcoin as strategic reserves, the days of volatility are over, or soon to be over. I still believe that one bitcoin will one day be worth $1,000,000, but it's not going to happen overnight. It's going to be more like gold.

clintstorres

What exactly do you mean with arbitrage? Short STRC and long SATA?

thinkingperson

So 6 mths later, they start selling btc to raise more cash to extend the runway for STRC? Meanwhile, in this 6 mths, they prob issue more STRC and buy more btc. Way more than they would need to sell in 6 mths?

Independent_Cat_5481

The issue is that if bitcoin doesn't grow at the 10-30% they are betting for long enough on it either collapses or becomes a Ponzi scheme. Because they will either have to maintain paying dividends with investor's money, which is the textbook definition of a ponzi scheme, or they will be forced to suspend dividends at which point people will run for the door, which will make it impossible to maintain the $100 value. Really if you believe Microstrategy is correct in how much bitcoin will grow you should just invest into bitcoin, because then you're at least only taking on the risk of bitcoin. Where investing in STRC is taking on both the risk of bitcoin and Microstrategy. It's more risk for the same or less reward.

leroyyrogers

STRC holders: this is finr

Lefties_TheWorst7331

Hopefully we see the bi-monthly dividend from STRC soon, should help a lot. Also, June 1st is when the dividend pays out that was ex'd a week or so ago. I would imagine *some* people have DRIP enabled, so when that dividend hits people's portfolios and gets DRIP'd on the 1st, that may give a little boost, too!

HSuke

STRC seems to be most profitable right after the ex-div. I'm not looking at $100. I'm actually looking for how far above or below the expected saw-tooth pattern STRC and SATA are. If it's close, then it's not worth the effort, but if there's a big deviation, then it's worth switching.

HSuke

Oh. Now you're asking the smart questions and going down the misleading BPS metric rabbit hole. BPS is calculated as: (Total BTC) / (Assumed Diluted Shares Outstanding) Diluted shares includes convertible debt, so paying that off increases BPS. The problem with BPS is that it doesn't account for cash reserves or for preferred shares (except for the convertible STRK). It also doesn't account for BTC price. It's a misleading metric that can be manipulated. For example, they can keep selling and diluting STRC, and it just increasing BPS, which is why BPS is currently increasing. https://np.reddit.com/r/MSTR/comments/1thtje5/the_measuring_problem/ https://x.com/thelogman/status/2053156489422848062

UC_DiscExchange

When are you selling STRC? It isn't hitting $100 until close to the next ex-div, so you're probably selling at a loss as well if you're unloading it around $99.40 shortly after.

UC_DiscExchange

Far more advantageous IMO to just simply hold STRC and not pay taxes for at least a year when it can be long-term cap gains.

Medium_Change4574

But does Micron have a ponzi like BTC with STRC

HSuke

They can. They've been selling STRC whenever it's over $100, which they call "ATM". Historically, they've used this to buy BTC, but they could use it to replenish the cash reserves. And the reserves are what pays the STRC dividends. Kind of like a pyramid-adjacent scheme.

HSuke

It's on track to reach $100 before the next ex-div date. Honestly, I think reaching $100 too early is a sign that STRC buyers are too stupid to properly arbitrage between STRC and SATA. If either hits $100 too early, it's more profitable to switch to the other until the ex-div date.

HSuke

My bets are on: * 70% chance of selling STRC * 25% chance of selling BTC (there's a chance now that mNAV is under 1.22) * 5% chance of inventing something once again to attract new ~~bagholders~~ customers

frugaleringenieur

It has been common that $STRC only reaches par around the last month before ex dividend date. However, they half the frequency so we should see a faster reach of par - with less days of trading at par. Comparing to $SATA, I agree that an increase of dividend would probably reach par and ATM better than obligations are pressing.

AlbiBambi

They can buy STRC and get 11% on the remaining money /s

Jiecut

I don't think they can use STRC for cash reserves?

HSuke

I think they took the opportunity when it came. The holders of the convertible debt must agree to the early payback. I estimate it'll take 2 months of STRC ATMs to rebuild their reserve assuming they don't buy anymore BTC for the next 2 months. Doing this also hurts their all metrics like BPS. But it might take much longer if they keep buying BTC in a bear market instead of saving cash like they just did last week. The timing of this debt repayment is really weird. Ideally, they should've done it during the STRC ATM week of the month so that they can replenish it quicker.

Automatic_Branch_367

They will just sell more STRC to pay the dividends on STRC. Problem solved!

macetheface

100k in most of US is basically a years salary. 2 at best. You could not work for 2 years but then be right back where you started. Not life changing. Put 1M into STRC and get 10% dividends yearly, now that is life changing.

Less-Information-256

This is just so they can buy bitcoin with STRC and pay the dividends with bitcoin so that they can appear less like a ponzi than if they just cut out the middle man. I think given how embarrassing it must be for him to change his position it’s probably after receiving legal advice.

HSuke

Why can't they just act like a normal company and focus on increasing long-term shareholder value and EPS? That's really frustrating for STRC and MSTR shareholders.

HSuke

Oh definitely. * First it was selling business intelligence software. * Then it was selling convertible debt to buy BTC * Then it was increasing mNAV * Then it was selling STRC preferreds * Now it's maxing BPS, a bullshit metric that ignores Bitcoin's price Gotta move the goalposts to keep attracting new "customers"

2xfun

Quick question: if the success of STRC depends on a substancial yearly BTC price appreciation, why is Stratergy  buying via OTC instead of spot? 

Myntad_com

STRC looks promising, as does SATA. Huge chunks of bitcoin have already been bought with the capital raised to date, and dividends have been paid consistently so far.

2xfun

I hope STRC works. :)

yefuck

SATA and STRC are better yielding digital credit.

2xfun

STRC is a fantastic product for normies. But there is a catch: only if BTC keeps growing 

tj78492

I'm comparing the mortgage to STRC, not bitcoin to a house. If you don't know what a carry trade is that's fine. You cant live in a treasury bond either, but people have been borrowing yen to buy them forever.

Myntad_com

I think products like STRC will be successful as a stable 11.5% yield is something people understand more easily. I would ofc prefer to see them study and then buy bitcoin

Medium_Change4574

So a BTC-based ponzi (STRC) generates revenue for BTC? Lmao

ReliantToker

Grow relative to what what? The dollar? Stables depreciate just as the dollar they are pegged to. Yield you recieve will not outrun the printer. If your looking for principle protection and higher than debasement yield within the bitcoin ecosystem have a look at STRC or SATA.

benditbackwards

remember its not one man, its all the retail that are buying STRC and MSTR that made make up the 4%

Friendly-Western-677

STRC

2xfun

I think it all comes down to if the new Stratergy financial product gets critical mass adoptions: STRC. But’s it also a catch 22: if BTC fails (doesn’t deliver the expected 30% returns) STRC will fail eventually… if STRC doesn’t get enough adoption Stratergy will stop buying BTC  Bottom of the line: no one knows shit and a stock market crash might destroy an asset like BTC 

BraveAssignment6407

I would advice you to STRC stock and get monthly income as dividends from your stock rather than buying BTC.

harvested

This is all haters. Their focus over the years moves from bitcoin to Strategy to STRC.

HSuke

Can confirm. The BTC bulls in the MSTR community mainly buy MSTR instead of STRC. If anything, our buying STRC helps Microstrategy fail harder and faster. It makes it less sustainable in the long run.

SoundMoneyWade

Btw, 95.8% of that was funded by Stretch. $1.94B was from STRC and only $83m was raised from the common stock. Not financial advice just interesting facts.

dataCollector42069

Idk how "reputable" news sources like CNBC and Bloomberg don't just straight up call MSTR/STRC a ponzi

tesseramous

btc could go to $250k tomorrow and as a holder of STRC you get nothing, only your regular 1% monthly dividend. The people buying this stuff dont really care about BTC, its just some algorithmic 'buy something with a high dividend' thing. I dont see how this can possibly end well.

tesseramous

fr he bought about 100,000 coins since it hit 60k and that has to be like all that kept it up and bounced it. And now not only is his average higher but half of his entire company is STRC stock with high dividends he has to be pay.

glorious_tribble

I think Commercial adoption has helped Bitcoin but I always fear derivatives and algorithms created around it that will try to turn it into an investment for quick profit. I like STRC too (11% Dividend).

2xfun

Microstrategy just created the biggest financial instrument the world has ever seen: STRC. That’s the topic.

BitcoinBaller420

Following up quickly on my manic liquidity rant yesterday with a much calmer Friday... I quickly look at the farm post-STRC-singularity and see... meh that kinda sucked in some ways. Seems like once-again STRC was the place to be, even the market did also make it clear I was right not to think holding STRC was not going to work out the way these div-flippers think, even though STRK div-flippers are given a golden chance to sneak a div and be pumped that their STRK-per-share went up when they buy back in, luck bastards... Overall, considering the short-term markouts were stellar, and I gave a long-term plan over the next two weeks up front, I give myself an B. Not bad but plenty to learn from this about what I need to build to automate this process. My call on the total STRC was off, but qualitatively not bad, and could look a lot better when the Strategy report comes out... we see if Clarity passes soon, etc. Plenty to leave room for randos to doubt my power, but also, markouts don't lie, the execution was really strong, bottom line at the close showed it too. We'll judge the STRK later, as the market is clearly daring me to hold STRK for a couple weeks. But the flows again are dumb imo, and while it's true the market can be irrational longer than I can remain solvent... I can remain solvent for a *really* long time at these leverage levels. I just want STRK more which means I like my portfolio exactly where it stands. Heavy Bitcoin capital with a sensible risk-spectrum of allocation that is risk-on, light credit, and Bitcoin-only in existential exposure, heavy risk-on with 100% STRK, and light GLD, TSLA, etc. some other fun things in the mix at smaller percentages. I decide my next step is to touch grass for two weeks, maybe check in now and then to see if Mr. Market is doing anything dumb as they are quite prone to do. Thanks for watching, see you then. edit: grade myself more humbly, **A-** becomes a **B**... gotta give more weight to the miss that STRK would be especially good vs the Bitcoin pref community on exactly this day, and missed, even if my strategy recognized the uncertainty correctly and (maybe) still got it right. Time will tell, we can adjust later as we get more data. No shame in being wrong, seek the truth, Know Thyself.

BitcoinBaller420

ps but gun to my head if I had to bet, and knowing I could check the current Bitcoin price to cheat but not bothering because Gen-X whatever… I’d bet MSTU up big again tomorrow / today / Friday the 15th, STRC ex-div date, because Strategy should be in there buying spot hardcore still with their haul from yesterday and this should give a nice statistical 1d tailwind. Maybe. Buyer beware, I ain’t backing this liquidity guesswork with my own funds, because as Buffett said, this shit is rat poison squared. Wait not that one… he said something very wise and humble and deep… he said (roughly) listen…  If I had to guess I would go long. But I don’t have to guess. ❤️🧠🐀

BitcoinBaller420

I upvoted this earlier but it didn't register somehow just how interesting this is. Really?! Kind of strange that STRC hasn't already done this if it's that easy lol. Makes me wonder if I'm as in-sync with what's happening as I thought... hmm, time to learn more. Thanks for the tip!

BitcoinBaller420

update! I go to throw another \~4 BTC of buying demand in for STRK as I try to finish establishing this long-term position. Market is like $76.06 by $76.28 at this point. I queue up an order to place at like 76.10 because I want to get filled but maybe only if the market will come to me now. As I go to place, what do I see but some kind soul has reached across the spread to place a sell at 76.12. So I don't nickel-and-dime this soul, I just place my order at $76.12, fill them, thank them kindly, and also pat the HFT boys that tried to step in front of us and take fills at 10c and 11c and say thanks for the liquidity boys, good luck turning a profit on those fills. Currently setting the global bid in this product at $76.12 for size, hoping for STRK holders to sell to me as they grab STRC and make their bid for an overnight bid capture. Suckers.

PheelGoodInc

STRC is crushing it this week. That is good for Bitcoin.

BitcoinBaller420

ps I know the network effect is on because just as I go to sing the praises of STRC for wealth management to my personal network, I discover that at least a few of them have heard, while many have not. The fact that a few have heard is insane, STRC is not old and Bitcoin is not a common topic in my network. But the fact that also so many don't know but a few words from me can light a fire that quickly hits (which I see in their faces they want to learn more and will go give it to their people to consider), say, a big entities wealth management practices because that entity is just ignorant of this product right now (I'm say talking to their CFO or something)... I'm barely trying, I know others are trying harder, IT'S. ON. \- sincerely some dude on the internet trust-me-bro dyor

BitcoinBaller420

You understand perfectly why this is a controversial prediction. I haven't actually seen the earnings call funnily enough, but I feel pretty tuned-in to Saylor's mind (not surprised that they said they could sell Bitcoin, also not surprised the world was surprised because everyone loves to exaggerate and no one can just see the nuance of the fucking thing)... and he sees what I see because he helped me see it... Strategy does not need to sell MSTR common for STRC sales to make sense for a very long time with Bitcoin at least like $750k / coin, and further, they have decided they don't need to sell MSTR to avoid spooking credit markets and wreck the network effect before it starts. It's started. It's on. And they are going to just lever-long as hard as they can during / inducing an insane mind-melting short squeeze that will expose a lot of people swimming naked out there imo. ps I dig your style too homie

el_rico_pavo_real

Love this post - only thing I am not sure of is the zero MSTR ATM. I believe, and I could be wrong, they like to sell a proportional amount of MSTR to maintain the amplification ratio of STRC… so I expect some MSTR ATM, just not a ton, relative to STRC or previous ATM sales.

BitcoinBaller420

**tl;dr - markets are stupid and Bitcoin is ridiculously underpriced** Here's what happens next. STRC has its first $2 billion day today, and Strategy is the primary seller. This weekend, Bitcoin continues to go up as Strategy deploys these new funds into spot. By Monday, the world realizes that Saylor is seriously not selling MSTR common, when Strategy releases their weekly sales / purchases and there is 0 MSTR on there vs $2.5b+ in Bitcoin, despite nice premiums available, Bitcoin strength, and juicy mNAV for the taking. Bitcoin per share soars in just 1 week, and the mNAV starts looking stupidly low. Strategy eventually starts tapping the ATM at a much higer immediate profit, and this efficiency just pours more jet fuel on the fire as the greatest short-squeeze in world history begins to take shape over the next year, driven by credit market demand for STRC's high-return-on-very-low-risk-tax-deferred asset qualities. Right after that, the Clarity Act will be passed, and Strategy will quickly announce at least one partnership with a major bank to realize their dream to back a 0-vol money-market USD account with Bitcoin as the backing collateral. The US bank savings deposit base immediately becomes much more accessible to start moving into Bitcoin, now with regulations and approvals to the highest levels, and guidance from advisors these people have trusted for decades. That's yet another big deal in the future demand curve for Bitcoin (not to mention a huge win for the everyman facing an impossible battle with a 0% savings account that leaks 5%+ buying power every year). I went balls deep yesterday, I'll be in there picking up some deals on the 3-month prefs today. STRK imo is stupidly under-priced right now.... 10% ROC and I get a perpetual call on leveraged-Bitcoin?! What are we talking about here. I'll be on the bid side again today, see you there.

Snowman33001

And why is that? It’s because Bitcoin is not yet taken seriously as collateral. I expect this to change with time. But again, nothing is guaranteed. Most institutions need minimum three years of a product like this before they even consider looking at it. STRC started ten months ago.

BitcoinBaller420

It's the liquidity mismatch between those people who hold STRC until it hits $100, then buy Bitcoin, and those people who do the same, but during the extra couple days, they don't buy Bitcoin, they buy some other non-Bitcoin-exposed (or partially exposed) asset, resulting in short-term sell pressure on the spot. It's temporary and smart money says it's a dip-buying opportunity as always. ... Or so I heard, I'm not smart money dyor.

Snowman33001

Yes, there’s certainly counterparty risk, like most things. I’m not sure I agree about not needing the principal back soon. Seems to be liquidity is quite high, especially relative to other preferreds. I would say it is “cash-like” but definitely not a money market fund. Of course the interest rate is variable, or even haltable, I would hope anyone who buys it would know that. I believe the main reason “no one outside of retail” will touch it (there definitely are institutional holders but they are the minority,) is because it is still new and institutions have oversight and regulatory rules that retail does not. Not saying it’s guaranteed, certainly not, but I’m comfortable telling people if you want bitcoin exposure without the volatility, check out STRC. At least be aware that a product like that exists out there and it’s backed by Bitcoin. I think that’s pretty cool, whether you want to use it or not.

No_Artichoke_5670

As much as a fan of Saylor that I am, STRC is NOT a good investment for "short term cash". STRC is for people okay with ongoing counterparty risk to Strategy/Michael Saylor’s capital structure who don’t need the principal back soon. It’s clever leveraged BTC accumulation for the company, but not “cash-like” for your short-term needs. STRC can suspend the dividends at any time. It's a brilliant scheme for the company and a shit investment for the vast majority of people. There's a reason no one outside of retail will touch it. Just buy Bitcoin.

Snowman33001

It’s a good day to buy Bitcoin. Or if you need short term cash, perhaps check out STRC.

GreenStretch

BTC spinoff investments like STRC.

No_Ebb_3017

Clearly nobody wants Bitcoin anymore. All liquidity flowing to stocks. Even STRC is barely pulling in any money.

Savings-Leading4618

They either sell BTC in the future, or the whole STRC thing was a ponzi. So I am glad he has come clean about their intentions. Now, their bussines does make sense.

Hfksnfgitndskfjridnf

A strategy based an issuing an exponentially increasing amount of securities that carry a 11.5% coupon isn’t a real strategy, it’s a guaranteed failure. It isn’t the first 10 Billion of issuance that’s the hard part, it’s the next 100 Billion you have to issue to keep it going that becomes the problem. If they issue 10 Billion of STRC per year, after only 9 years all their capital raising will go towards servicing those dividends and not towards anything else. So they can’t issue just 10 Billion a year, they must issue progressively more and more each year. With how volatile Bitcoin is historically and how little it’s used in the wider economy besides speculation this is guaranteed to blow up on them. They might push the price up in the near term, but all that does is allow them to keep issuing more STRC, which they will assuredly issue as much as the market will allow them. Inevitably Bitcoin will decline massively from a recent high and the market will know MSTR is in an unsustainable situation. The market will anticipate MSTR sales of Bitcoin and will wait for it to happen.

Calm_Situation_1131

Yeah and next year Saylor can sell 280 BTC to cover dividends for current and prior year STRC sales. And then sell 420 BTC the year after that. And then 560 BTC. If he stops at any time, that BTC sale number still happens even if no further STRC sales and BTC buys occur. Wait, the number is going up but it's the wrong number.

Romanizer

Yes, it assumes that dividend payment of 11% is lower than the 100% of new purchases of STRC.

HSuke

I was going to say that they needed **12500** BTC to cover all STRC dividends for a year, but I see that your "NEW holders" is doing the heavy lifting.

PrestondeTipp

Yup lol the "flywheel" - issuing STRC to benefit MSTR shareholders, and then issuing more MSTR shares to pay STRC shareholders Robbing Peter to pay Paul 

ChangeHeroOfficial

Good breakdown. The STRC dividend structure is the part most people gloss over. Unrealized losses are one thing, but fixed cash obligations are a different kind of pressure. Probably not an imminent risk, but calling it completely off the table doesn't hold anymore either.

Adventurous_Initial6

If they sell Bitcoin a little Bitcoin but buy 20x that amount in a month like they claim they’ll do, why not just buy 19x in a single transaction? If you sell 1 Bitcoin to pay $STRC dividends and then issue enough $STRC to buy 20 Bitcoin, why not just issue that $STRC, buy 19 Bitcoin, and then pay off dividends with 1 Bitcoin worth of costs? It’s entirely identical, just that the first method has more steps.

BuddahFi

Agreed, if the scenario is isolated to only selling STRC, fund dividends, then buy more Bitcoin with the proceeds. However they might also use the sale to buy back debt, or just buy back shares of MSTR if mNAV is low. That would all increase Bitcoin/share for shareholders (which is ultimately is their business model). It all depends on the current mNAV and whatever the market is doing. Selling Bitcoin is not a goal, it's just a tool in the toolbox for gaining shareholder value.

Needsupgrade

>As long as investors keep absorbing new STRC, the cycle continues. But if demand for STRC slows down, the dividend obligations don’t disappear. The company would then face large recurring cash outflows without fresh capital to offset them. You literally described a Ponzi scheme 

Romanizer

What you are missing here is that Strategy is still a net buyer even when they are selling. Selling at all will only be done under certain circumstances, although I think some distribution is good and necessary. In those cases these proceeds will be used to pay dividends and attract further STRC clients, allowing to buy more than they sold. This is a positive feedback loop.

RevengeRabbit00

STRC just started trading at 100 again allowing them to sell at the market shares and purchase more bitcoin. They’ve also voted to pay out the dividend bi-weekly instead of monthly to lower the volatility and get back to 100 quicker after people sell once they meet the dividend deadline.

Hfksnfgitndskfjridnf

They didn’t sell any STRC last week and the week before they didn’t buy anything but had 80 million in dividends they paid out on. I’m guessing BTC per share decreased.

uberlap

In Saylors plan it is coming from the price appreciation of Bitcoin which, yes, is caused by other people buying bitcoin but still makes you incorrect to claim all of STRC‘s dividend is "return of capital." It‘s declared return of capital to save tax until the cost basis is used up, after that all dividends will be be taxed normally. I‘m not claiming STRC is a sound business model, just pointing out that you’re not getting the tax aspect of the „return of capital“ part.

Full-Atmosphere-4818

LOL. I understand and like (love) Bitcoin. The real thing. If you like Saylor's crap products, that's on you. Oh look, he just had to sell Bitcoin to pay a dividend. Right on schedule! Enjoy. I'll look you up when your investment tanks and we can chat then. In the meantime, enjoy your cult status with the "Second best" product known as STRC.

spid3rfly

I'd probably sell 200-300k worth, stick it in STRC and immediately quit my job.

So-lost-right-now

Sell for fiat, invest all in STRC, retire and live on the STRC dividends

Medium_Change4574

You either buy quality alts or buy BTC and help Saylor feed his STRC ponzi

uberlap

I think you're misunderstanding something here. Declaring it as "Return of Capital" is basically a tax trick to avoid having to pay tax on the dividend until your initial cost basis has been used up. Once your initial investment has been "returned" you won't stop getting dividends, they will keep coming, you just have to start paying taxes on them... So saying STRC is just paying your money back to you is false, since you'll get more than your initial investment eventually.

HSuke

Coffee did not adequately prepare for that video. I'd like to see a debate between actual experts on the topic. I could tell Jeff was just using marketing lingo and misleading figures to hide the weaknesses in Microstrategy's plan. Jeff's math is defining "failure" as when a company is completely bankrupt and ALL their investments go to zero, whereas most normal people would define "failure" as when a company's investments go down in price 80%, new investors stall, and everyone stops talking about the company. That's one of the main differences between what Jeff's saying and what Coffee is saying. Their plan isn't as risky as Coffee tries to make it sound, but it's also nowhere near as safe as Jeff tried to make it sound. Overall, the plan works really well if BTC keeps going up over 10% annually and the number of new STRC investors (who are liabilities through dividend payments) doesn't increase drastically vs BTC price. But it really sucks if BTC price stagnates or goes down for several years. Microstrategy can definitely survive, but a lot of STRC and MSTR investors will pull out if Microstrategy is forced to continue selling STRC, MSTR, and BTC.

MariachiArchery

STRC pays about an 11% dividend. To push the yield into the 30's, you've got to leverage that dividend. It's risky, and the yield reflects that. Far from the zero risk the Anchor protocol advertised.

HSuke

That reminds me. Did you know that you can already get 30% interest leveraged tokenized versions of Microstrategy's STRC stock?

LorenzoVonMatterh0rn

Saylor himself still recommends holding BTC over STRC. States STRC is a vessel for people who want exposure but don’t want to deal with the volatility

dangerdanpeterpan

I think this is why STRC is now/is going to become so popular. A low-volatility indirect investment in bitcoin to hold and borrow against.

bansoma

The issue with this strategy in practice has been the borrowing rates. Most of these loans require you to share custody of your BTC (a huge liability) and charge 10-11%+ annual rates. Technically this is achievable, but if you run the math you may actually be better off just selling the BTC and buying STRC with the cash instead. The drag minus the opportunity costs come very close to matching just simple self custody. A much better plan is to use a traditional mortgage as your liquidly, don't buy a house in cash, get long loan terms, refi if the rates have a 3-4 year payoff. Consider a HELOC instead of a BTC loan if equity builds, these rates are high but still lower than BTC rates. All money is fungible, that's the point, treat it that way and get the best terms you can. All collateral strategies carry a large amount of risk. They work great day to day, but when they fail they fail spectacularly and suddenly. Many wise investors caution against investing in things that give steady stable gains but carry acute downside risk. Leveraged positions are one of those. In all cases tax treatments for your unique situation are a huge opportunity when they exist.

BigJRecords

The math actually disagrees with this concern. Strategy's total annual dividend obligation across all preferreds is ~$1.49B. That's $4.1M/day. Bitcoin spot volume runs $25-35B daily on regulated exchanges alone. Funding the entire annual dividend by selling BTC would be roughly 0.016% of daily volume. Even in a worst case where STRC scales to Saylor's $350B target, the annual obligation hits $40B or $110M/day. That's still only ~0.4% of daily spot volume.

Torshein

I run 0% credit cards and buy Bitcoin and STRC. When they quit giving me free money I'll sell some and pay the cards off.

himtnboy

Why not borrow from Coinbase at 4.5% and invest into STRC which pays 11.5%?

fan_of_hakiksexydays

Even if BTC was to go up forever, the issues of something similar to a "bank run" and things getting out of hand with the selling of shares and yields can still happen. But Saylor doesn't seem to have taken into account that bull cycles have had drastically diminishing returns each time. We don't have 600x returns anymore. It went down to 23x. And this last bull cycle was down to 8x. And everyone was already so disappointed by those returns. What happens if next bull run the returns are too small and are even more disappointing? What happens if BTC falls just short of a new ATH? What's gonna happen to MSTR and STRC? We might not even need to find out since we might only need a new drop for the house of cards to unravel.

YePeX

People are assuming that if MSTR ever sells some BTC, it is automatically bearish. I do not think it is that simple. The real question is what the sale funds. If it strengthens the capital structure, supports STRC growth, or lets MSTR take advantage of panic-driven dislocations later, then it may actually be part of the long-cycle strategy rather than a retreat from Bitcoin. There will always be accumulators and panic sellers. That dynamic is exactly why fixed-supply assets can benefit when funded by inflationary currencies. The bigger picture is still the same: Bitcoin is becoming a hedge against monetary disorder, banking distrust, and eventually maybe even settlement-layer competition. I would not tell anyone to go all in. But having exposure to BTC/MSTR/STRC as a hedge against how unstable the world is getting still makes sense to me.

fan_of_hakiksexydays

Saylor breaking away from "never selling" Bitcoin is something we probably should have guessed was eventually gonna come. Luckily, STRC on the other hand is something we can see a little bit better, and there's no points for guessing what's coming here when the $100 depegs too much and selling shares or having to raise the yield too high backfires, and people who thought this was like a bank product realize what they bought, and can't get their money. In the past, FTX, LUNA, Voyager, were things that were difficult to see at the time. You could definitely tell something was a bit off and didn't add up. But most people were still hopeful that these were major players, with big player money behind it, "too big to fail", etc... And even people who saw the potential issues of the depeg of LUNA, still said it was very unlikely to happen and there were ways to counter it if it did happen.

TeaCharacter23

STRC buying spree

LetWinnersRun

I bet some people that hate Bitcoin buy STRC

Misschocolat73

Happy with my PENDLE bag that shot up from $1.10 to $2. RWA, STRC, CLARITY… quite a few tailwinds lined up so I’m happy sitting in this alt for now.

HSuke

Also, if you watch the [streamed YouTube video](https://www.youtube.com/watch?v=chp-9I6Wros), the live chat and reactions are gold. Saylor also talked about being able to maintain STRC dividends indefinitely as long as BTC ARR is over 2.3%. I'm skeptical about that metric. They COULD do that, but that would really, really hurt MSTR shareholders. What's the purpose of MSTR if all BTC bought with MSTR is just going to be used for paying off STRC dividends? This metric does not seem fair.

HSuke

I watched the whole 2-hour meeting. **Both the CEO and Saylor spent about 30 minutes talking about selling Bitcoin, so they're serious this time.** Here are my takeaways: * This seems to be a response to shareholders being upset that MSTR has been cannibalized and taken a backseat to buying BTC. They also want to reduce MSTR short selling and FUD. * Microstrategy's overall goal is still to increase MSTR price, BTC price, and BTC/share ratio. They are still focusing on STRC as their main product. * They want to pay back convertible bonds/debt early and discontinue selling any further convertible bonds. This means selling ~10% of their company value in either MSTR, BTC, or STRC. * There are a LOT of variables they're considering for when they want to sell Bitcoin. There's no simple formula they're using. * One of the main criteria they mentioned is whether mNAV is under 1.22, which is their breakeven point under which it's more advantageous to sell Bitcoin. * They want to maintain a reserve of about $2.5B (or 1.5 years in STRC dividends) in cash equivalents.

azdcaz

MSTR accelerating their BTC purchases through the success of STRC. Consistent buy pressure from the ETF’s. Both causing buy pressure never seen before. The Clarity act likely passing soon.

sylsau

**🚨 THE SACRED COMMANDMENT OF BITCOIN IS DEAD. 🚨** For years, the $MSTR playbook was a one-way black hole: Raise fiat. Buy Bitcoin. **NEVER SELL.** But you can’t pay an 11.5% fixed yield with diamond hands. 💎👐 ➡️ 💸 To fund the massive dividend obligations on their new $STRC preferred stock, the ultimate Bitcoin whale just admitted the unthinkable: *They will have to sell BTC.* The "infinite money glitch" is officially over. The market's biggest buyer of last resort is now on a billion-dollar cash-flow treadmill. **What happens to the market when the black hole reverses? 🕳️🔄**

steppe5

People here didn't like it when I called STRC a Ponzi. Now that it's all starting to crumble, allow me to say I told you so.