MSTR issued a preferred stock with a 10% dividend but it was not promised to be paid and the dividend was not accrued, which is also quite awesome. This year, Mstr has issued two tranches of preferred stock: 7.3 million STRK in January with an 8% dividend to raise $560 million, and 8.5 million STRF shares in March with a 10% dividend to raise $710 million. This issuance of STRD, with a high dividend yield but harsh payment terms. Looking at the market reaction, if the investor response is not enthusiastic, it is estimated that the terms will have to be modified.
June 2, 2025 $MSTR released the latest $STRD What's It?
To put it simply, STRD Preferred Stock is a "Series A Perpetual Preferred Stock" designed by MSTR with a coupon of 10% per annum, but it is a non-mandatory, non-cumulative distribution mechanism.
The rhetoric is that Strategy wanted to buy more $BTC, but the money was not enough, and in order to get cash, they issued a special stock called $STRD. These shares are listed separately and can be purchased freely.
The essence of STRD is to lend money to MSTR at a 10% annual interest rate financing, but MSTR may not pay 10% annual interest as promised, and if it is not paid, it will not be repaid in the future.
Although it seems like nonsense, it is indeed prepared to do this, although it is not mandatory, non-cumulative, but in the description MSTR also promises to pay it on time, provided that the company is profitable.
So the question arises, where does the cash paid to STRD come from?
It is true that MSTR is still profitable on the books, but if you don't sell the Bitcoin on the books, you know the book income, and the problem of paying taxes before is that there is no reason to pay taxes because of the book income, but if you need to settle part of the BTC, you have to pay taxes, so selling BTC is not a way to pay interest, yes, but not the only one.
In addition to selling BTC, MSTR can continue to raise funds and use the raised funds to pay interest on the annual STRD, and it seems that they plan to do so now.
Also, What if STRD doesn't pay interest?
The answer is no way, he has the right not to pay, but if he chooses not to pay, then the secondary market price of STRD will plummet, and MSTR's financing will become extremely difficult, so investors generally still feel that MSTR will choose to pay interest during the bull market.
As for the bear market, let's talk about the bear market.
PS: Personally, I think it's very likely that MSTR will do some plans to stock up on Bitcoin, such as lending BTC, such as participating in some quantitative transactions, to maintain cash flow, and it is very likely that MSTR may become a BTC-based bank in the future.
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