ModelsSTRC death-loop
STRC death-loop model
Strategy pays STRC's dividends from a USD reserve it refills by selling shares. Pick a Bitcoin path and see when that stops working and coins get sold.
More about this model
Strategy pays monthly dividends on STRC and its other preferred stock. Since 29 June it keeps a USD reserve of at least 12 months of those payments, and refills it by selling common stock while its shares trade above its Bitcoin.
When Bitcoin falls far enough, the shares trade below the coins and selling them stops working. The reserve then carries the dividends until it reaches its floor.
From there, Bitcoin itself has to be sold, and a large seller moves the price it is selling into.
Verdict
No coins have to be sold the reserve keeps up.
Reality check
$99.74
par $100 · low $74.57 on 26 Jun$4.88B
▲ from $0.90B at the report848,250
6,916 sold Jun to AugSTRC pays 12.00%. Shares trade at 1.12× the coins, so selling them still refills the reserve, which covers about 3 years of dividends.
- actual
- Base from today
- v1.2 said
- 12-month floor
- what Strategy did: hover a number
v1.2 started from a $3.0B reserve and drained it. The real one was $0.90B; share and Bitcoin sales lifted it to $5.10B (3 to 6).
Scenarios
What the first model missed
| v1.2, at the report | What happened | v1.3, now | |
|---|---|---|---|
| Dividend bill | 10.5% on $34B: about $3.6B a year | $1.56B a year on $13.7B of preferred stock | Live from Strategy, with the STRC rate on top |
| The reserve | Spent down to zero, then coins are sold | A floor of 12 months since 29 Jun, refilled by share sales: $0.9B to $5.1B | Floor of 12 months; refilled up to $1.5B a month while mNAV is above 1 |
| Selling coins | Only once the reserve is empty | 6,916 BTC sold by choice in Jun to Aug, with the reserve above $2.5B | Forced sales only: at the floor, with share sales shut |
| STRC rate | +2 points for every 10% Bitcoin falls | +0.5 points after STRC fell 22%; held at 12% since | +0.6 points for every 10% Bitcoin falls |
| Starting point | $100,000 Bitcoin, $3.0B reserve | $64,047 Bitcoin, $0.90B reserve on 4 Jun | Today's figures, read live |
Calls the report made
- Not due yet
The dividend rate keeps rising whenever STRC trades below par; it was 11.5% at the report, up from 9% at launch.
Each monthly rate noticeRaised once, to 12.00% on 29 Jun. Strategy now says it will not raise the rate just because STRC trades below par.
- Not due yet
The cash reserve is gone around month 16 in the base case, so the first forced Bitcoin sale lands near October 2027.
October 2027The reserve is $4.88B and has a 12-month floor. Strategy did sell 6,916 BTC in Jun to Aug, by choice rather than forced.
- Not due yet
Strategy sells about 131,000 BTC over five years in the base case, and nearly all of it if Bitcoin grinds down 28% a year.
June 2031, with yearly checkpoints6,916 BTC sold so far and 11,460 bought, so 848,250 are held, 4,544 more than at the report.
No coins have to be sold the reserve keeps up.
- First coins sold
- Never
- ▲ report Oct 2027
- BTC sold, 5 years
- 0
- ▲ report 131k
- Coverage, 5 years
- 5.9×
- ▲ coins cover it all
Adjust the scenario
Starts from Bitcoin $80,998, 848,250 BTC, a $4.88B reserve, a 12.00% STRC rate and an mNAV of 1.12, on 15 Oct 2026.
USD reserve
Share sales keep the reserve near three years of dividends.
Bitcoin held
Reality vs yours
| Measure | Reality so far | Your scenario |
|---|---|---|
| USD reserve | $4.88B on 4 Oct | $4.8B after 5 yrs |
| Bitcoin sold | 6,916, by choice | none forced |
| STRC rate | 12.00% | 12.00% at peak |
| Bitcoin held | 848,250 | 848,250 after 5 yrs |
The loop, step by step
The bear path sets off 7 of the 7 steps.
- Bitcoin falls (set off)
- Shares below the coins (set off)
- Refills stop (set off)
- Reserve hits its floor (set off)
- Coins sold (set off)
- Sales hit price (set off)
- Falls further (set off)
Questions
What happens to STRC if Bitcoin falls 30%?
Strategy's shares fall below the value of its coins, so selling them no longer refills the reserve. Dividends then come out of the reserve until it reaches its 12-month floor, and coins are sold from there.
When does Strategy have to sell Bitcoin?
Only when two things happen together: its shares trade below its coins, so share sales stop, and the reserve has fallen to its 12-month floor. The base path never gets there; on the bear path it is Nov 2028.
Didn't Strategy already sell Bitcoin?
Yes, 6,916 BTC between 29 June and 9 August 2026, for dividends, the reserve and STRC buybacks. Those were chosen sales with a reserve above $2.5B. The model counts only sales Strategy cannot avoid.
Why was the first version off?
Version 1.2 charged dividends on $34B at 10.5%, more than twice the real bill of about $1.56B a year, and spent the reserve to zero before selling coins. Strategy's 29 June framework keeps a 12-month floor and refills the reserve with share sales. Version 1.3 follows those rules and starts from today's figures.
Is this the model from the report?
No. It is a simplified monthly model, first calibrated to the report's scenarios and recalibrated in October 2026 to what Strategy has filed since. The analysts' full Python model stays private and is described in the report.
Sources
Model settings
Overview shown