Why Did Strategy STRC Stock Falls 5.3% Below Par Despite Attractive Yields?

Key Insights:

• Strategy (STRC) dropped as much as 5.3% below par despite offering an 11.5% annualized dividend yield.
• The $10 billion preferred stock erased months of dividend income in a single day of trading.
• DeFi products linked to STRC also lost their pegs, with some falling more than 4%.

The Bitcoin-backed preferred stock of Strategy, STRC, plunged as much as 5.3% below its $100 par value on June 3, even as it offers a high annual dividend yield (about 11.5%).

This one-day drop erased roughly five months of STRC’s dividend income in one session. The sell-off also forced STRC-linked crypto products off their $1 pegs.

Strategy (STRC) Stock Plunges Below Par

STRC is a perpetual preferred share issued by Strategy (formerly MicroStrategy) and tied to the company’s Bitcoin holdings.

According to market data, STRC traded down to about $94.70 on June 3. That is 5.3% under the $100 target price that Strategy has long tried to defend.

The drop came even though STRC pays an annualized dividend of roughly 11.50% – a rate far above standard U.S. savings products.

In fact, Strategy will pay a monthly dividend of 0.96% on the $100 par value in June, but the stock’s steep slide outweighed those payments.

STRC has swelled to a market capitalization of about $10 billion, more than triple its size earlier this year. Its rapid growth was fueled by investors chasing yield and a perceived link to Strategy’s bitcoin-rich balance sheet.

Strategy launched STRC at a 9% yield in July 2025 and raised the payout seven times to 11.5% as the price repeatedly lingered below par.

But the recent crash shows that strategy has limits: one report notes that the preferred stock’s collapse “shows that a preferred stock backed by a bitcoin-heavy company can still lose value quickly when the underlying market turns against it”.

Strategy (STRC) Linked Stablecoins Lose Pegs

The shock to STRC quickly rippled into the crypto ecosystem. Decentralized finance (DeFi) projects had created synthetic stablecoins pegged to STRC’s value and dividends.

For instance, the Saturn protocol issues sUSDat and Apyx issues apxUSD, both designed to stay near $1 by being backed by STRC.

apxUSD USDC Chart | Source: TradingView

As STRC slid, those tokens lost their peg. Saturn’s sUSDat dropped about 3.7% this week, and Apyx’s apxUSD fell roughly 4.1%.

Both had traded very close to $1 for months but have now weakened alongside STRC. In effect, traders who were using these tokens as high-yield “stablecoins” saw price losses – contradicting their name and purpose.

Underlying the turmoil was a sudden move by Strategy to sell some of its bitcoin. SEC filings show Strategy sold 32 BTC for about $2.5 million between May 26 and May 31 to fund STRC dividend payments.

This was the first bitcoin sale by Strategy since 2022 and broke CEO Michael Saylor’s long-held “never sell bitcoin” stance. Within 24 hours of the sale, Bitcoin’s price plunged about 4.4%, and over the week it was down roughly 12%.

Strategy MSTR Stock Chart | Source: Google Finance

The fall in bitcoin, Strategy’s primary asset, compounded pressure on STRC. Meanwhile, Strategy’s common stock (ticker MSTR) also tumbled on the news.

Strategy’s stock fell around 15% over the same week. Investors grew skittish: with bitcoin dropping, both the company’s stock and its preferred shares slumped. The sell-off showed that STRC is not insulated from broader crypto market moves.

High Yields, High Risks

The STRC episode is a reminder that high dividend yields come with risks. Unlike a bank account, STRC carries no FDIC or SIPC protection.

Strategy explicitly disclaims any price guarantee or insured backing for STRC. Investors chasing the 11.5% yield essentially treated STRC and its DeFi wrappers as if they were low-volatility, but last week’s market turned that assumption on its head.

Strategy’s STRC stock fell sharply because of a rare bitcoin sale and a broader crypto market dive, despite its attractive yield.

The decline wiped out months of dividends in one day and even pushed so-called STRC “stablecoins” away from their $1 target.

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