Strategy’s Bitcoin Flywheel Wobbles as STRC Sinks to Record Low

Strategy’s STRC preferred shares have fallen to their lowest level since launch, trading well below their US$100 (AU$142) liquidation preference and raising questions about a key funding channel behind the company’s Bitcoin accumulation strategy. STRC dropped to an intraday low of US$82.53 (AU$117.19) on Thursday before closing at US$88.59 (AU$125.80), around 13% below par.

Launched in July 2025, STRC was designed to remain close to its US$100 (AU$142) benchmark through adjustable dividends, with proceeds primarily used to purchase Bitcoin. The widening discount has pushed the instrument’s effective yield above 12.9% and contributed to a pause in at-the-market share issuance, potentially slowing the capital-raising mechanism that has supported Strategy’s Bitcoin treasury.

The decline has reignited criticism from Bitcoin sceptics. Peter Schiff has repeatedly described STRC as “a classic centralized Ponzi”, arguing the structure depends on raising fresh capital or selling Bitcoin to meet obligations. Crypto trader DonAlt also questioned the security’s performance, asking why it was “trading like a Ponzi”.

Related: Bitcoin Microtransactions Surge to 80% of Network Activity as Ordinals and Runes Fuel Onchain Growth

Bitcoin Buying Pace Slows

The pressure on STRC has coincided with a slower pace of Bitcoin purchases. Strategy acquired 1,550 BTC for US$101 million (AU$143.42 million) in the week ending 8 June and a further 1,587 BTC for US$100 million (AU$142 million) in the week ending 15 June, bringing total holdings to 846,842 BTC.

Those purchases were significantly smaller than earlier acquisitions this year. In April, the company bought 34,164 BTC for US$2.54 billion (AU$3.61 billion) in a single week, while another 24,869 BTC were purchased in May for approximately US$2.01 billion (AU$2.85 billion).

Strategy also sold 32 BTC worth around US$2.5 million (AU$3.55 million) earlier in June to help meet dividend obligations. While minor compared with its overall holdings, the sale highlighted that cash requirements can still result in Bitcoin sales when funding conditions become less efficient.

Not all analysts see the sell-off as evidence of a flaw in Strategy’s model. Jesse Myers, head of Bitcoin strategy at The Smarter Web Company, argued the decline was driven by leveraged positions being unwound rather than a deterioration in the company’s fundamentals. Meanwhile, analyst Scott Melker noted that because dividends are calculated against the US$100 (AU$142) liquidation preference, investors purchasing STRC at discounted prices receive a higher effective yield.

Related: Algorand Races Ahead on Quantum Security, Targets Fully Quantum-Resistant Blockchain by 2027

The post Strategy’s Bitcoin Flywheel Wobbles as STRC Sinks to Record Low appeared first on Crypto News Australia.