Michael Saylor (CEO) is firmly convinced that bitcoin is the hardest money on earth in that; it is not controlled by any central authority, it's value cannot be inflated away - there will only ever be 21 million, and it is permissionless, meaning no one can be prevented from tranacting in bitcoin. He also realized that holding any currency, including the US dollar is like holding your wealth in ice cubes because each year it loses > 10% in purchasing power.
So he initially convinced his board of directors to convert their entire cash balance into bitcoin and then proceeded to give conferences detailng the methods he used and extolling bitcoin's value, during which he learned how much institutional interest there was but that they were prohibited to do invest in it.
Many financial institutions were unable to gain exposure to Bitcoin because of various restrictive internal and external regulations. However Microstrategy uses low-cost debt and equity issuances (e.g., convertible notes, preferred shares) to fund Bitcoin purchases, amplifying returns without selling existing holdings, and enabling institutions to satisfy that bitcoin itch.
These offerings were incredibly well recieved and most were over-subscribed, because they allow entities to get indirect exposure to Bitcoin. In fact, there was so much expressed interest for these products, that Microstrategy has been forging innovative new products specifically tailored for various other segments of the stupendously large amount of money under the care of these institutions.
Below are short summaries of the perpetual preferred stock offerings: STRK, STRF, STRD, and STRC.
STRK (Strike Preferred Stock): Offers an 8% fixed annual dividend based on a $100 liquidation preference, paid quarterly. Includes a conversion feature allowing holders to exchange 10 STRK shares for 1 MSTR common share if MSTR reaches $1,000, providing potential equity upside. Initially raised $563 million at an IPO price of $80 (20% discount). Appeals to investors seeking a blend of yield and capital appreciation.
STRF (Strife Preferred Stock): Provides a 10% fixed annual dividend on a $100 stated amount, paid quarterly, with cumulative dividends that compound at an additional 1% per year (up to 18%) if missed. Raised $711 million at $85 per share. Designed for stability, it’s non-convertible and senior to other preferreds, targeting income-focused investors.
STRD (Stride Preferred Stock): Offers a 10% fixed non-cumulative annual dividend, paid quarterly, with no obligation to pay missed dividends. Raised nearly $1 billion at $85 per share (15% discount). Junior to STRF and STRK in seniority, it targets long-duration yield investors with higher risk tolerance.
STRC (Stretch Preferred Stock): Features a variable dividend rate (initially 9%), paid monthly, with adjustments capped at 25 basis points to maintain stability. Plans to issue 5 million shares at $100 each to raise $500 million. Designed for low volatility, it’s positioned as a safer, income-focused option with high Bitcoin collateralization.
All proceeds from these offerings are primarily used for Bitcoin acquisitions and general corporate purposes. Each stock caters to different investor risk profiles, with STRK offering conversion potential, STRF prioritizing seniority and stability, STRD targeting high-yield seekers, and STRC focusing on predictable income.
These preferred stock offerings, although very well received by institutions, are on the complex side, with varying terms, and dividends. STRC on the other hand is structured in a much simpler fashion. The product is designed for low volatitlity and is targeted to the high yield money market crowd. To quote Michael Saylor during Strategy’s Q2 2025 earnings call, “Unlike our earlier products, which were innovative yet too complex, STRC is straightforward—like a high-yield savings account,”
The inital offering was for $500 million, but STRC interest sky-rocketed so the offering was enlarged to $4.2 Billion. This product seems to be a huge winner with the investment community and will very likely be the workhorse for Strategy as they continue accumulating Bitcoin, which means MSTR stock will not face as much a dilution risk as it previously did. See the following X post on recently released discipline guidance on MSTR Common Stock issuance.
Here's where you can do a deep dive into these various investment vehicles.
Feel like investing in MSTR now? Good, that means you've been paying attention!
Thanks for reading!