Strategy Raises Stretch (STRC) Dividend to 11.25% as BTC Volatility Tests Balance Sheet
Michael Saylor said Strategy is once again turning to its preferred equity structure to balance investor demand for income with the volatility inherent in its Bitcoin-heavy balance sheet.
Strategy Raises Stretch Dividend Again
The executive chairman of Strategy (MSTR) announced that the firm increased the dividend rate on its Stretch (STRC) preferred stock by 25 basis points to 11.25% for February. The move marks the sixth dividend increase since STRC first began trading in July 2025.
The update was shared by Michael Saylor in a post on X, continuing a pattern of regular adjustments designed to keep the instrument attractive amid shifting market conditions.
The company positions STRC as a short-duration, high-yield savings-style product, aimed at investors seeking income rather than direct exposure to Bitcoin price swings. The preferred stock pays monthly cash distributions and is structured as a perpetual security, making it a long-term fixture within the company’s expanding capital stack.
How STRC Is Designed To Stay Near Par
Unlike traditional preferred shares with fixed coupons, STRC’s dividend rate is reset monthly. Strategy says this mechanism is intended to encourage trading near the $100 par value and to limit price volatility by adjusting yield in response to market demand.
On Friday, STRC closed at $98.99, slightly below par, suggesting the structure is broadly achieving its goal.
STRC share price (Source: Google Finance)
By raising the dividend rate when prices soften, Strategy can support demand without directly intervening in the market, while investors benefit from a higher yield.
This approach reflects a more active form of capital management than the company employed in earlier phases of its BTC strategy, which relied heavily on common equity issuance and convertible debt.
Dividend Reserves And Payout Commitments
To support its growing suite of preferred offerings, Strategy has raised $2.25 billion in reserves dedicated to funding dividend obligations.
According to the company’s public dashboard, annual payouts across its perpetual preferred stocks total approximately $887 million.
Those reserves are designed to reassure investors that dividend payments are insulated, at least in the near term, from BTC’s price volatility. By pre-funding obligations, Strategy aims to reduce concerns that market drawdowns could force cuts or suspensions to income payments.
The reserve-backed model also allows the company to market STRC as a more conservative income product, even as Strategy remains one of the most aggressive corporate holders of Bitcoin.
Bitcoin Volatility Frames The Announcement
The dividend increase follows a volatile weekend for Bitcoin, which briefly fell below $76,000 on Saturday. The decline momentarily pushed Strategy’s average BTC cost basis underwater, highlighting the sensitivity of the firm’s balance sheet to sharp price moves.
Bitcoin has since rebounded and was trading near $78,500, easing immediate pressure. Still, the timing underscored why Strategy continues to diversify its financing channels beyond instruments that are closely tied to equity performance and BTC sentiment.
BTC price (Source: CoinGecko)
For income-focused investors, STRC offers a way to gain exposure to Strategy’s credit profile without directly riding bitcoin’s daily fluctuations.
A Broader Shift In Strategy’s Capital Playbook
The repeated dividend hikes suggest the company views STRC not as a static product, but as a flexible tool that can be tuned to market conditions.
By adjusting yields monthly, the company can keep the preferred stock competitive with other high-yield alternatives as interest rates, risk appetite, and crypto sentiment evolve.
