Bitcoin’s Plunge Brings Strategy’s Holdings to Near Breakeven, but Key Test Lies 18 Months Ahead
As Bitcoin tumbles and the company’s shares are down nearly 70% from last year’s peak, liquidation calls from the sidelines for Strategy (MSTR) are growing louder, calling into question for some the firm’s ability to continue meeting its obligations.
Throughout 2025, the Strategy has relied mostly on over-the-counter (ATM) issuances of common stock, primarily to meet preferred dividend obligations, while consistently relying on preferred stock as the primary financing vehicle for bitcoin purchases.
Led by Chief Executive Michael Saylor, the company issued four U.S.-listed preferred series during the year: Strike (STRK) pays a fixed dividend of 8% and is convertible into common stock at $1,000 per share. Strife (STRF) pays out a 10% fixed non-cumulative dividend and is the most senior among preferreds. Stride (STRD) also pays 10% cumulatively and is ranked second in the structure. The newest series, Stretch (STRC), debuted in August at $90 with a fixed cumulative dividend of 10.5% and is currently trading just above the offering price.
As of November 21, STRK is trading around $73 with a current yield of 11.1%, down 10% since issuance. STRD was the weakest performer, falling to around $66 with a 15.2% return and a 22% total return loss. STRF is the only series still above the issue, trading around $94 and gaining around 11%, reflecting its top position.
Bitcoin’s decline in recent weeks has market participants focusing on around the $74,400 level; This level means that after more than five years of accumulation, the Strategy will actually be in the red on its Bitcoin holdings.
While this is certainly a key level for the talking points, a drop below $74,400 certainly doesn’t mean the company will face a margin call or have to start force-selling any portion of its BTC stack.
The closest structural pressure point is almost two years later on September 15, 2027, when holders of $1 billion of 0.625% convertible senior notes receive their first put option.
The bonds were priced when MSTR was trading at $130.85 and the conversion price was $183.19. With the stock currently at around $168, shareholders will be unlikely to convert and will likely want a cash refund; this would potentially require the Strategy to increase or liquidate assets unless the share price rises meaningfully before 2027.
Even if the MSTR equity valuation premium on Bitcoin holdings (mNAV) collapses further and perhaps even goes down, the Strategy still has a clear path to cover its annual preferred dividend bill.
