Strategy (MSTR), the Nasdaq-listed bitcoin treasury company, announced an increase in the annual dividend rate on its STRC variable-rate perpetual preferred stock. The dividend was raised by one percentage point from 9% to 10%, effective for the September dividend period. The September dividend was set at $0.8333 per STRC share, payable on September 30 to holders of record as of September 15.
STRC, marketed under the ‘Stretch’ brand, was engineered to trade near a $100 par value. The dividend framework incorporates an at-the-market issuance program with issuance windows and call options designed to maintain price stability within a narrow trading band. Upon reaching the $100 par target, additional STRC shares can be issued to fund further bitcoin acquisitions under the overcollateralization mechanism.
As part of the update, Strategy also declared dividends for other preferred series: STRF at $2.50 per share, STRK at $2.00 per share, and STRD at $3.0556 per share. These declarations align with the firm’s broader capital deployment strategy, balancing high-yield offerings with collateralized bitcoin reserves. Strategy reported purchase of an additional 4 048 bitcoin, increasing total treasury holdings to 636 505 BTC.
The STRC instrument is backed by a five-to-one bitcoin collateral ratio. For every $1 of dividend liability, approximately $5 of bitcoin value is held in reserve. This high level of overcollateralization provides security to dividend payments and enhances investor confidence in yield distributions. The design contrasts with traditional fixed-rate preferreds by dynamically adjusting issuance and distribution parameters.
Volatility management tools built into the STRC framework include dividend stoppers and issuance halts if market price deviates beyond the trading corridor. These mechanisms aim to mitigate price swings and support reliable dividend flows. Market reception since the July 30 debut saw STRC shares appreciate by roughly 8%, trading near the intended $100 threshold.
Yield-seeking investors are increasingly drawn to STRC for stable income and bitcoin exposure without direct spot market volatility. Strategy’s approach of blending yield-oriented equity instruments with digital-asset backing could serve as a model for future hybrid capital products. Ongoing monitoring of issuance volumes, price dynamics, and collateral adequacy will influence the sustainability of dividend distributions and potential expansions of the at-the-market program.
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