Strategy Leans on Bitcoin Holdings to Cover Preferred Stock as STRC Slips Below Par

Strategy offloaded 1,638 BTC for about $105 million to fund preferred stock dividend payments and buy back STRC shares, as its variable-rate preferred stock continues to trade roughly 10% below its face value.

In the latest Bitcoin developments, Strategy (Nasdaq: MSTR), the bitcoin-focused treasury firm led by Michael Saylor, revealed in an SEC 8-K filing that it had sold 1,638 BTC for approximately $105 million.

The funds from this sale are intended to cover dividend obligations across multiple preferred stock classes — including STRC, STRK, STRD, STRF, and STRE — as well as to finance repurchases of STRC shares.

This move goes beyond a simple asset sale. It reflects a broader capital management strategy, where the company is simultaneously adjusting its bitcoin reserves and liquidity to meet growing cash commitments tied to its preferred stock structure.

Bitcoin News Update: Sale Details, Pricing, and Pause in Accumulation

Strategy sold the 1,638 BTC at an average price near $64,000 per coin, significantly below its overall average purchase price of $75,419. Despite realizing this gap and holding an estimated unrealized loss of $10.9 billion, the company remains among the world’s largest corporate bitcoin holders. The $105 million sale represents only a small portion of its overall holdings.

Notably, this marks the sixth straight week in which Strategy has not added to its bitcoin reserves, breaking from its long-standing accumulation strategy.

The pace of selling has increased over time. The company sold just 32 BTC in May 2026, followed by 3,588 BTC in early July for about $216 million, and now this latest batch. All proceeds are being directed toward preferred stock dividends and STRC buybacks.

STRC Preferred Stock: Buybacks and Dividend Dynamics

Repurchasing STRC shares has become a central part of Strategy’s financial strategy. STRC, the firm’s Variable Rate Series A Perpetual Preferred Stock, offers a 12% annual dividend and has a par value of $100 per share, though it continues to trade below that level.

As of July 31, STRC closed at $89.46, placing it approximately 10–11% under its face value despite offering its highest-ever dividend yield.

Originally launched in July 2025 with a 9% dividend rate, STRC has undergone seven consecutive monthly increases, reaching 12% for record dates starting July 1, 2026. This rise is driven by a built-in adjustment mechanism: whenever the stock trades below $95, the dividend increases by 0.5%, and once raised, it cannot be reduced even if prices recover.

Strategy recalibrates the dividend rate each month in an effort to push the stock price back toward its $100 par value, which is crucial for issuing new shares and raising additional capital.

However, the continued discount has forced the company to halt new STRC issuance under its at-the-market program, limiting its ability to fund further bitcoin purchases through this channel.

Competitive pressure is also mounting. Rival firm Strive has introduced its SATA preferred security, offering around a 13% yield with daily dividend payments and no associated debt, attracting investor interest away from STRC.