Stretch loses its flex: STRC slips to $91 as traders tell Saylor to stash the cash 🧻

Strategy’s variable-rate perpetual preferred stock STRC dropped 3.58% to $91.79 on Tuesday, sitting 8.2% below its $100 par value as investors pulled back following the company’s latest Bitcoin purchases. Markus Thielen, CEO of 10x Research, said the market would prefer to see the firm preserve capital for dividends rather than expand its $BTC stack. "The market would rather see [Strategy] not acquiring more BTC and rather keep the cash for dividend payments," Thielen told Cointelegraph, adding that traders view the recent buys as "an unsustainable path for STRC."

STRC is designed to deliver an 11.5% dividend yield at par, but with the price decline, its effective yield has risen to 12.5%. Strategy disclosed on Monday that it bought 1,587 $BTC for roughly $100 million last week, following a 1,550 $BTC purchase the prior week at a similar cost, bringing total holdings to 846,842 $BTC.

Nick Ruck, director at LVRG Research, attributed part of the slide to broader market conditions, citing "broader risk-off sentiment in crypto markets" that has weighed on appetite for the instrument. Ruck noted that while the variable dividend anchors the perpetual preferred near par, "persistent selling pressure and concerns over Strategy's expanding capital structure and ATM issuance appear to be testing that resilience in the near term."

Strategy’s common stock (MSTR) fell 6.35% on Tuesday to close at $122.81, down 67% over the past 12 months. The preferred shares are also facing competition from Strive’s perpetual variable-rate preferred (SATA), which is trading at $100 with an effective yield of approximately 13%.