Strategy’s perpetual preferred stock Stretch (STRC) is under serious financial stress due to two simultaneous pressures, reported onchain analytics firm CryptoQuant on Tuesday.
The Bitcoin bear market means that all BTC purchased between 2024 and 2026 is underwater, with $10.6 billion in unrealized losses, and cash reserves are depleted, down 38% since early 2026 after a $1.5 billion convertible senior note repurchase in May.
Strategy pays dividends on its Stretch product, which offers an 11.5% yield and is designed to trade at $100. However, it fell to a record low of $82.5 last week, a record 17.5% below par.
At current prices of $87.4, the current effective yield is 13.2%, according to the STRC tracker.
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The core problem is that Strategy’s dividend obligations have nearly quadrupled to $1.2 billion per year, while the cash to cover them has shrunk, collapsing dividend coverage from more than seven years to just 14 months.
Last week, Strategy claimed that it ha
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