Strive’s SATA is rising while Strategy’s STRC is stalling
The contrast between the two companies and their respective instruments is notable.
Sentiment seems to be shifting about STRC, Strategy’s perpetual preferred equity instrument, which launched in July 2025 and has a notional value of $10.4 billion and an 11.5% dividend.
STRC has fallen below its $100 par value amid news that Strategy’s $1.5 billion repurchase of convertible debt means the company’s cash reserve may cover only six more months of dividend payments.
In contrast, Strive, Inc. Variable Rate Series A Perpetual Preferred Stock, a similar instrument from Strive Inc. that launched in November 2025 with a 13% dividend, has held above its $100 par value. In addition, the company announced it will start paying dividends daily, effective June 16.
Meanwhile, Strategy hopes to pay dividends semimonthly rather than monthly, pending a shareholder vote on June 7.
Alex Blume, founder and CEO of Two Prime, told Sherwood News that Strategy’s inconsistent policies regarding cash reserves, debt management, Bitcoin sales, and future plans continue to dampen confidence in the safety of STRC.
“As a result, with BTC on the back foot, the product is struggling to remain at par. Strategy will likely have to continue raising its offered rate to preserve demand for this high-risk product. The competing priorities among $STRC, $MSTR, and their other debt products are not fully compatible over the long term. How this plays out remains to be seen,” Blume said.
In contrast, TD analyst Lance Vitanza views STRC’s move to change dividend payments as a positive for both the company and its shareholders. For Strategy, Vitanza said it could improve STRC demand while reducing volatility and improving liquidity for shareholders, prompting him to reiterate a “buy” rating on Strategy.
Not everyone agrees with this premise, and Pratik Kala, portfolio manager and head of research at Apollo Crypto, said that “ironically,” semimonthly dividends may make the problem more pronounced.
According to Kala, STRC is out of favor, with many people looking to short it, and semimonthly dividends will not help unless founder Michael Saylor “can show the cash to fund it.”
“Saylor only has to pay a dividend one time a month. Compressing it to two times a month when he doesn’t have money just makes the problem visible. Here is an analogy, imagine you don’t have $$$ and people know it. But if you have to pay your debt once a month people will still chill / have patience / give the benefit of the doubt. If you have to pay every two weeks, the issue will be more visible — that you are struggling to pay $. So if he can get the $$, it’s great,” Kala said.
But right now, he said, it seems the only way he can get money is by selling bitcoin, which will dampen sentiment.
While Strategy has said that it would “probably sell some bitcoin,” a stunning reversal of its previous HODL stance, it may do so sooner than expected.
Lookonchain reported that Strategy has moved 411 bitcoin, worth $30.3 million, to Coinbase Prime. While the move itself does not mean the company is about to sell, it adds to the rumor mill, and John Nahas, chief business officer at Ava Labs, told Sherwood that the transfer is the detail everyone’s watching right now.
“The never-sell narrative that propped up MSTR’s premium for years is effectively done with. SATA gaining steam makes sense in this situation. When the flagship preferred is wobbling below par, yield-hungry investors start shopping around, and a cleaner alternative with less balance sheet volatility looks increasingly attractive,” Nahas said.
Paul Howard, senior director at Wincent, echoed the sentiment, telling Sherwood that the bear market “has its first victim in its jaws with STRC.”
Investors are losing confidence in its sustained ability to buy bitcoin, albeit perhaps temporarily, but the same investors will now focus on SATA as an alternative yield play, he said.
“While I still expect prices to trade higher later in the year, the latest movement from MSTR to Coinbase is a strong leading indicator that prices will likely go lower first and the smart money will be sitting on the sidelines,” he said.
The recent developments have also prompted Arca CIO Jeff Dorman to say MSTR’s story “has gotten so out of hand.” Dorman said the company’s push into the preferred was based on bitcoin mooning, which clearly isn’t the case. With a few days left in May, bitcoin, which has been stuck in a very tight range, is about to close the month in the red.
“That plan may just be selling BTC, which he will have to do eventually, but if he does this while BTC is in a death spiral it’s going to crush BTC and MSTR. So again, why buyback the debt now and force your hand sooner than you have to?” Dorman said. “But TLDR — this is the first time that MSTR, BTC, and Pref holders are really in bind. Someone is going to lose badly here, and it will happen in the next 4 months.”
