Under pressure from both a decline in Bitcoin prices and an eight-month consecutive drop in its own stock, MSTR, Bitcoin Reserve announced that it will increase the dividend yield of its perpetual preferred stock, STRC (Stretch), to 11.5%. This is the seventh dividend increase since the product's launch in July 2025, highlighting the company's gradual shift in its financing strategy from common stock to preferred stock amid market turmoil.
MSTR's stock price is facing pressure after eight consecutive days of decline, while Bitcoin also plummeted.
MicroStrategy (MSTR) shares have fallen nearly 20% this year and plummeted 62% in six months, marking its eighth consecutive month of losses. Since its intraday high of $543 in November 2024, the stock has fallen by a cumulative 75%, closing at $129.50 last week.
During the same period, the price of Bitcoin fell by 16.37% in February, and has plummeted by approximately 24.6% since the beginning of the year. This prompted several Bitcoin reserve companies (DATs) holding large amounts of Bitcoin to cut their losses and sell off their BTC to cash out . Among them, the average cost of holding Bitcoin for MicroStrategy was approximately $76,020.
With lackluster stock performance and sluggish cryptocurrency prices, MicroStrategy's capital pressure continues to rise.
Seventh increase in dividend yield: STRC yield rises to 11.5%
Against this backdrop, MicroStrategy announced today that it will further increase the annualized dividend of its STRC Perpetual Preferred Stock by 25 basis points to 11.5%. The dividend is paid monthly, and through a monthly interest rate reset mechanism, it helps to keep the share price around the $100 par value, transforming highly volatile digital capital into a product similar to fixed income, in order to appease investors who are panicked by the recent decline in the cryptocurrency market.
STRC is a perpetual preferred stock with no maturity date, meaning the company is not required to buy it back at a specific time. The company states that its design aims to reduce price volatility and encourage trading around par value. During the market turmoil in February, STRC traded below $100, and this increased dividend is seen as one of the measures to stabilize the price.
Shift in financing model: Preferred stock replaces common stock as the core tool
With common stock prices fluctuating wildly and losing their premium advantage, defensive instruments like preferred stock may become an important channel for companies to obtain liquidity in the future. As Phong Le, CEO of MicroStrategy, pointed out a few weeks ago, the company will gradually reduce its reliance on issuing common stock as a source of funds for purchasing Bitcoin and instead increase the scale of preferred stock issuance.
He stated that last year, approximately $7 billion was raised through STRC and other perpetual preferred shares, representing 33% of the overall preferred share market, and he expects preferred shares to become the primary financing mechanism by 2026.
Recently, the company has continued to increase its Bitcoin holdings, with the latest purchase of 592 coins in mid-February, bringing its total holdings to 717,722 coins. This has resulted in a floating loss of approximately $7.9 billion on its position, and it has also become the stock with the highest short position among all U.S. companies with a market capitalization of over $25 billion.
This article, which couldn't withstand the continuous decline in MSTR's stock price and the sharp drop in Bitcoin, saw MicroStrategy increase the dividend of its STRC preferred stock to 11.5% . It first appeared on ABMedia, a ABMedia .
