Strategy Holds STRC Dividend at 12 Percent After $8.2 Billion Loss and Its First Bitcoin Sale in Four Years

Strategy, the largest corporate holder of bitcoin, kept the dividend on its STRC preferred stock at 12 percent this month. That breaks from its recent practice of raising the payout when the security trades well below its $100 par value. Leaving the rate unchanged signals that the company is trying to conserve cash rather than raise the coupon to push the security back toward par.

The context is a difficult quarter. Strategy reported an $8.2 billion net loss, driven by a mark-to-market writedown after bitcoin fell below the roughly $75,000 average cost of its holdings, and the shares fell after the report. The firm sold bitcoin for the first time in four years, disposing of coins to cover preferred dividends, and has authorized further sales to raise dollars, fund buybacks, and meet interest and dividend obligations. Management says it is assembling a multibillion-dollar cash reserve to cover those payments for more than two years.

The mechanism worth naming is the funding structure. Strategy accumulated bitcoin using debt and preferred shares whose holders expect steady payouts. When the underlying asset falls below cost and the preferreds trade under par, the company must either issue more equity into a weak stock, raise coupons it cannot easily afford, or sell the reserve asset it was built to hold. It has now chosen the last option, at least at the margin.

This is the first genuine test of the leveraged-treasury model. Selling bitcoin to pay investors in a bitcoin strategy is coherent accounting, but it reverses the accumulation story that justified the premium these vehicles once traded at.