Strategy's STRC Preferred Stock Plunges to Record Low, Halting Key Bitcoin Funding Channel

Strategy's (NASDAQ: MSTR) preferred stock, known as STRC or "Stretch," has fallen to an all-time low, weakening a crucial funding channel the company uses to finance its bitcoin purchases. The stock closed at $89 on June 17, down approximately 11% from its designed par value of $100, and hit an intraday low of $88.50—its first dip below the initial public offering price of $90. Launched in July 2025, STRC is a variable-rate perpetual preferred stock designed to maintain a stable price through monthly rate adjustments. However, persistent bitcoin price weakness—with BTC trading around $64,000—has pressured the security. The decline has forced Strategy to suspend its at-the-market (ATM) share issuance program, which previously allowed the company to raise cash by selling new STRC shares at premiums above par. With the stock now trading below $100, this funding mechanism is no longer viable, limiting Strategy's ability to continue accumulating bitcoin. The situation is compounded by growing concerns over the dividend's sustainability. STRC currently offers a dividend yield of 12.9%, paid bi-monthly. In late May, Strategy sold 32 bitcoin for approximately $2.5 million to fund these distributions—the company's first bitcoin sale since 2022. This move broke Chairman Michael Saylor's long-standing pledge never to sell, rattling the market. Strategy has since built a dedicated $1.1 billion U.S. dollar reserve to cover preferred dividends and debt, while still acquiring 1,587 bitcoin through common stock sales. The company remains the largest corporate bitcoin holder, with about 846,842 BTC—roughly 4% of the total supply that will ever exist. Meanwhile, MSTR common stock has declined 68% over the past 12 months, closing at $116.52 on June 17, reflecting broader investor unease.