Saylor's "Stretch" Hits a $74 Stretch: Terra Comparisons Crash and Burn

Strategy's preferred stock STRC slid to a record intraday low near $74.13 on Thursday, dragging bitcoin with it as the company's preferred-share engine lost roughly 25% of its $100 par value in a single session. The slide extended earlier losses that had already pushed the stock to $82.53 last week and roughly $88.65 on Monday, according to Bloomberg and Yahoo Finance data. STRC, which carries the ticker "Stretch," pays an 11.5% annual dividend and is engineered to trade near $100; the mechanism that lets Strategy issue new shares to buy more bitcoin is now paused while the price remains below par.

Bitcoin fell to $58,188 before ticking back up to $59,273, a 3.3% decline over 24 hours, according to CoinGecko. The move came a day after bitcoin hit a 21-month low of $59,217 before firming to $60,700. CoinGlass data shows more than $1.44 billion in positions liquidated over the past 24 hours, with long positions accounting for $1.2 billion and bitcoin alone responsible for $658 million in liquidations. Strategy's common shares MSTR dropped 7% to $87.50 before recovering to $87.89.

The decline has reignited social-media comparisons to Terra's UST, the algorithmic stablecoin whose 2022 collapse erased about $40 billion in value. Both products offered high headline yields — STRC's 11.5% against the 20% Anchor once advertised — and both have drifted from their stated anchors. Benchmark-StoneX analyst Mark Palmer rejected the parallel in a Monday note. "STRC is not a stablecoin," he wrote, adding that "Strategy's objective has been to support STRC's trading at a level near $100, not to guarantee it" and describing the slide as "a market-driven reset of required yield" rather than a depeg, since nothing pegged to a fixed dollar value can be depegged.

The two instruments also differ mechanically. UST held its dollar peg through a mint-and-burn loop with sister token LUNA and held no hard reserves; when confidence broke, both collapsed. STRC is a preferred equity instrument backed indirectly by Strategy's 847,363 bitcoin, which the company values at about $54.5 billion and which BitcoinTreasuries.net lists at $50.4 billion. That corporate treasury link has, however, tightened the stock's price relationship with bitcoin: the 90-day correlation between STRC and BTC has climbed to nearly 0.70, the highest level since STRC's July 2025 debut, according to TradingView. STRC is down 23% this month to $76, while BTC has slipped nearly 20% to below $60,000.

The tighter correlation undermines STRC's pitch as a relatively steady income vehicle, and Strategy has made small bitcoin sales to cover dividend obligations, a shift from its long-standing "never sell" stance. With shares trading well below $100, the firm cannot tap at-the-market offerings to fund further bitcoin purchases, leaving the original feedback loop on hold until the price recovers toward par.