How STRC lost its par: The timeline behind Strategy's preferred-stock meltdown

STRC, the dividend-paying preferred equity issued by bitcoin treasury company Strategy (MSTR), is designed to hold a price of $100, its par value. It doesn’t always work that way.

On Thursday, the stock price dropped below $83, some 17% below the target and the lowest since it debuted in July 2025. The security is meant to be high-yield, low-volatility.

Keeping the stock near par is critical because it allows Strategy to raise capital efficiently through at-the-market (ATM) offerings to fund the annualized 11.5% payout.

In recent weeks, however, a sharp decline in the price of bitcoin $BTC$63,565.74, combined with a series of management decisions, have pushed STRC significantly below its intended trading level. Here’s how it happened:

May 14: STRC closed at $100 heading into its monthly ex-dividend date, while bitcoin traded above $80,000. On the surface, then, everything appeared normal. (Investors buying a stock on the ex-dividend date do not receive the payout, so the price tends to drop to reflect the lost value.)

Below the surface, though, the situation was messier. Bitcoin was already trading significantly below its October record of $126,000, and STRC had been able to maintain $100 only in the run-up to the ex-dividend date, not consistently throughout the month.

In addition, Strive Asset Management (ASST) chose that day to say it would pay dividends on its competing security, SATA, on a daily basis. SATA offers a higher yield, 13%, increasing pressure on Strategy as it sought shareholder approval to move STRC from monthly to semi-monthly dividend payments.

STRC’s proposed change was designed to reduce volatility around ex-dividend dates and help the security trade closer to par for longer periods.

May 15: Strategy announced the repurchase of $1.5 billion of its 2029 convertible notes at an 8% discount. While Strategy carried more than $8 billion in convertible debt at the time, Strive had none outstanding.

The transaction was part-funded using a dollar cash reserve established at the end of 2025 to support payments on dividends and debt obligations. The fund’s use in the transaction was not revealed at the time.

Bitcoin fell to $78,000.

May 18: Strategy bought 24,869 $BTC as the largest cryptocurrency slid toward $76,000.