Citing Bitcoin.com, a new Bitmex Research report examines Stretch (STRC), a novel debt instrument issued by Strategy, designed to maintain a $100 price by adjusting its monthly dividend rate. The report highlights that STRC’s variable dividend mechanism is unique, as it responds directly to its market valuation rather than benchmark interest rates. Bitmex notes that the capital raised from STRC is used to buy Bitcoin, and the company can reduce the dividend rate by up to 25 basis points monthly at its discretion, regardless of market conditions. The report also warns that missed payments could accumulate, potentially affecting Strategy’s ability to pay dividends on other stock classes. While STRC is marketed as a low-risk investment similar to short-duration U.S. Treasurys, the report argues it carries significantly more risk.
Bitmex Research Analyzes Strategy's STRC Debt Instrument, Questions Stability Claims
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