Bitcoin asset management company MicroStrategy’s CEO Phong Le disclosed on Wednesday that approximately 80% of the holders of its “Stretch” perpetual preferred stock (STRC) are retail investors. STRC is positioned as a low-volatility Bitcoin entry tool with an annual dividend yield of about 11.5%, significantly higher than the current approximately 4% yield on U.S. Treasury bonds.
The Design Logic of STRC: Creating an Entry Path for Investors Who Cannot Bear Volatility
MicroStrategy’s Executive Chairman Michael Saylor stated on Thursday at the 2026 Digital Asset Summit that the core design of STRC is “to create an entry path for those who believe in the long-term value of Bitcoin but cannot withstand short-term volatility.” In an appearance on CNBC’s “Power Lunch,” he likened STRC’s yield structure to that of a “money market fund,” emphasizing its stability positioning.
Phong Le pointed out that retail investors generally prefer “low volatility, high yield digital credit,” and the structural design of STRC is precisely aimed at this market demand. In March this year, MicroStrategy acquired approximately $1.2 billion in Bitcoin through STRC market transactions, becoming one of the largest sources of single BTC acquisitions this year.
Core Structural Features of STRC
Type of Stock: Perpetual preferred stock, with no maturity date, MicroStrategy is not required to repay principal to investors.
Annual Dividend Yield: Approximately 11.5%, floating calculation, adjusted monthly based on market conditions.
Target Trading Price: Maintained around $100, with design behavior similar to high-yield savings accounts.
Yield Mechanism: The first 10-11% of MicroStrategy’s annual returns are stripped away and allocated to credit investors.
Collateral Structure: Saylor stated that the collateral ratio is “severely over-collateralized,” using Bitcoin assets as the underlying support.
$42 Billion Expansion Plan: MicroStrategy Accelerates Its Capital Structure for Bitcoin Accumulation
Documents submitted by MicroStrategy to the SEC this week reveal that the company plans to raise up to $42 billion through two parallel channels, with $21 billion coming from the sale of MSTR common stock and another $21 billion from new STRC issuance. This is the largest formal capital plan disclosure since MicroStrategy announced in February this year that it would rely more on preferred stock sales to acquire Bitcoin.
Saylor noted that MicroStrategy is betting that Bitcoin’s annual growth will exceed the 11% dividend cost of STRC, making “equity holders will profit significantly, while credit investors will also be satisfied with the 11% yield.” Currently, Bitcoin has dropped about 45% from its all-time high, while MSTR common stock has fallen 19% year-to-date, down nearly 71% from its historical high of $456 in July 2025, presenting macroeconomic pressure on the STRC expansion plan.
Frequently Asked Questions
What is MicroStrategy’s STRC product?
STRC is a perpetual preferred stock issued by MicroStrategy, with an annual dividend yield of about 11.5%, aiming to maintain a target trading price around $100. Due to its perpetual structure, MicroStrategy does not need to repay principal, and holders earn income through floating dividends, positioned as a low-volatility indirect entry tool for Bitcoin.
Why is the retail proportion of STRC as high as 80%?
STRC offers a yield significantly higher than U.S. Treasuries while avoiding the price volatility risk of directly holding Bitcoin, aligning with retail investors’ preference for “low volatility, high yield” products. Phong Le pointed out that this design has successfully attracted a broad retail audience rather than being primarily dominated by institutional investors.
How will the $42 billion that MicroStrategy plans to raise be utilized?
According to SEC documents, the raised funds will be used to continue acquiring Bitcoin, expanding MicroStrategy’s BTC reserve scale. Saylor’s core logic is that the long-term annual appreciation of Bitcoin will exceed the 11% dividend cost of STRC, thereby generating excess returns for MSTR shareholders while maintaining yield for credit investors.
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