Strategy, Strive face balancing act between bitcoin buying and preferred stock dividends — SkimNews
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- Strategy has issued five classes of perpetual preferred stock since February 2025, becoming the dominant player in a $12 billion market that has funded 135,979 BTC purchases by Oct. 5.
- Fidelity reported that preferred stock financing represents over 0.5% of bitcoin’s total supply, with the model offering a complementary demand channel to ETFs.
- Bitwise expects spot bitcoin ETFs to remain the larger source of demand, while perpetual preferreds attract yield-focused investors who avoid direct crypto exposure.
- Strategy spent $193 million repurchasing its preferred shares (STRC) in a recent week while buying only 267 bitcoin, highlighting the capital tension between buybacks and accumulation.
- CoinShares noted STRC’s $7.5 billion raised in 2026 through July, carrying a recurring dividend cost that pressures ongoing bitcoin buying unless shares trade near par.
- Two Prime's Alex Blume emphasized that preferred stocks like STRC and Strive’s SATA reflect not just bitcoin exposure but also issuer management and capital structure risks, as seen in STRC’s drop to $70 in June.
Why it matters: For every dollar Strategy spends repurchasing preferred shares to reduce future dividend costs, it has less to buy bitcoin—directly constraining its core growth engine. With $3 billion authorized for buybacks and STRC trading near $99.40, the balance between sustaining investor demand and expanding holdings is tightening.
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