What Is STRC? A Complete Guide to Strategy’s Bitcoin-Linked Preferred Stock

What Is STRC?

Formally, STRC is Strategy's Variable Rate Series A Perpetual Stretch Preferred Stock, listed on Nasdaq. It sits between common equity and debt in the capital structure, so preferred holders rank ahead of common shareholders for dividends and for any liquidation claim, but behind bondholders.

• Variable dividend rate: Adjusts monthly. Strategy sets it to keep STRC trading near its $100 par value.
• Monthly cash payments: Paid at month-end to shareholders of record as of the 15th.
• Perpetual: No maturity date. Strategy never has to buy these back.
• Cumulative: Missed dividends accumulate and compound at the prevailing rate.
• Not convertible: Cannot be exchanged for common MSTR shares (unlike STRK).

STRC priced at $90 per share on July 24, 2025 (settled July 29), issuing 28,011,111 shares and raising roughly $2.5 billion, the largest US IPO of 2025. Executive Chairman Michael Saylor has called it the company's "iPhone moment." Nearly all of the proceeds went toward buying Bitcoin.

How the STRC Dividend Works

Strategy sets the monthly rate at its sole discretion, but the prospectus caps how fast it can fall: no more than 25 basis points plus any drop in the one-month SOFR rate from the prior period, and the rate can never go below the prevailing SOFR floor. Within those bounds, Strategy has said it will manage the rate to keep STRC trading near $100.

The rate started at 9.00% in August 2025 and climbed every month for seven straight months to 11.50% by March 2026. It has stayed there through June 2026, four consecutive months at the same level, even though STRC has traded below par since mid-April and dipped near $97 in late May. That the company chose to hold flat rather than raise further suggests it is balancing dividend cost against the risk of growing cash obligations.

Strategy is also weighing a shift to semi-monthly payments to further dampen price volatility. The proposal is subject to a shareholder vote.

STRC Dividend History

The STRC Bitcoin Connection

Capital raised from STRC goes almost entirely toward buying Bitcoin. As of May 25, 2026, Strategy holds 843,738 BTC at a cumulative cost of about $63.87 billion (roughly $75,700 average). That is roughly 4.2% of Bitcoin's circulating supply, making Strategy the largest corporate BTC holder by a wide margin.

In the week ending May 17, 2026, Strategy issued roughly $2 billion of new STRC (plus a small amount of MSTR) and used the proceeds to buy 24,869 BTC at about $80,985 average. Through early May, STRC had raised $5.58 billion in 2026. That mid-May issuance pushed the year's total well above $7.5 billion. Roughly $17.5 billion in STRC remains authorized for future issuance.

Understanding STRC Yield

The stated rate is 11.50% on the $100 stated amount, or about $0.9583 per share each month. Your effective yield depends on what you pay. With STRC trading below par for much of the past two months (it dipped near $97 in late May), buyers at current levels are earning slightly above the stated rate. Over the past year, effective yields have ranged from roughly 11.5% at par to about 13% when the stock traded at its lows. Track STRC pricing and dividend updates at strategy.com/strc/learn.

Key Risks

Bitcoin price dependency. Strategy's balance sheet is almost entirely Bitcoin. In a single quarter (Q1 2026), unrealized losses on its holdings exceeded $14 billion. If BTC enters a sustained bear market, Strategy's ability to cover preferred dividends comes into question.

Dividend rate is discretionary. Strategy can lower the rate at any time. Its own disclaimer: the "current rate is not indicative of future rate" and "may be significantly lower."

No collateral backing. Despite the "Bitcoin-backed" label in media, Strategy's own disclosure states that its preferred securities "are not collateralized by the Company's bitcoin holdings and only have a preferred claim on the residual assets." STRC holders have no direct claim on any specific BTC.

Cash flow gap. Strategy's software revenue does not cover preferred dividends. The company maintains a USD Reserve for this purpose, but has used a significant portion to repurchase convertible debt, leaving only months of coverage at current obligation levels.