The strategy has announced a new preferred stock "STRC". What do experts think?

## Bitcoin issuance for purchase

U.S. strategy company (formerly MicroStrategy) announced on the 21st its plan to conduct a new public offering (IPO) of 5 million preferred shares. The "Variable Rate Series A Perpetual Stretch Preferred Stock (STRC)" will be the fourth preferred stock supporting the company's Bitcoin purchase strategy, following STRK, STRF, and STRD.

Strategy Inc. aims to raise a total of $500 million (approximately 73.2 billion yen) by issuing 5 million shares at a par value of $100 (about 14,600 yen) per share. Cumulative dividends at a floating interest rate will be paid in cash monthly, and unpaid dividends will accrue interest monthly. The initial annual interest rate is set at 9%, but Strategy Inc. reserves the right to adjust the dividend rate within certain limits linked to market interest rates.

STRC is a perpetual preferred stock without a maturity date, but an option is established for the buyback of its own shares under certain conditions.

The company states that it will use the funds raised in this IPO for "general business purposes, including the acquisition of Bitcoin and working capital."

The preferred stocks issued by Strategy Corp. so far and their overview are as follows:

• Strike (STRK) Fixed non-cumulative dividend at an annual interest rate of 8% per quarter, convertible to common stock.
• Strife (STRF) Fixed cumulative dividend at an annual interest rate of 10% per quarter, not convertible to common stock.
• Stride (STRD) fixed non-cumulative dividend of 10% annual interest per quarter, not convertible to common stock.

Bitcoinの保有状況

Ahead of the IPO announcement for the preferred stock "STRC" on the 21st, Strategy Corp announced on the morning of the same day that it had additionally purchased 6,220 BTC at a price of $118,940 per BTC (approximately ¥17,420,000), for a total amount of $739.8 million (approximately ¥108.3 billion). The total amount of Bitcoin held by the company has reached 607,770 BTC. This accounts for about 2.8% of the total supply of Bitcoin.

Chairman Michael Saylor announced that the total amount spent by the company on Bitcoin purchases is approximately $43.61 billion (about 6.3863 trillion yen), with an average purchase price of $71,756 (about 10.5 million yen). The Bitcoin held by the company shows an unrealized gain of approximately $28.1 billion (about 4.1 trillion yen) on the books.

The company just announced the purchase of 4,225 BTC on the 14th, increasing its Bitcoin holdings for the second consecutive week. According to the documents submitted to the U.S. Securities and Exchange Commission (SEC), the proceeds from the sale of Class A common stock (MSTR), perpetual strike preferred stock (STRK), perpetual strife preferred stock (STRF), and perpetual stride preferred stock (STRD) were used for this acquisition.

The company has set forth a "42/42" plan aiming to raise a total of $84 billion (approximately 12 trillion yen) through stock issuance and convertible bond issuance by 2027 to further expand its Bitcoin investments.

Industry response

The issuance of STRC preferred shares by Strategy Inc. has garnered mixed reactions in the industry.

Adam Livingston, an author related to Bitcoin and a proponent of financial innovation, describes STRC as a "new financial life form" that is neither a traditional stock nor a bond. STRC is characterized as a "system for rapidly converting fiat currency into Bitcoin" and is evaluated as "attracting fiat currency through yield, enabling dollar-cost averaging investments into Bitcoin."

On the other hand, there are voices pointing out that the structure of STRC is very similar to a pyramid scheme, relying on continuous inflow of new capital to maintain high dividends.

Cryptocurrency analyst Jarm Crypto criticized, "What STRC is building is a huge future liability that ordinary shareholders will have to bear, especially in a bear market." He stated that even if he were offered ordinary shares of MSTR, he would not hold them.

Peter Schiff, known as a long-time critic of Bitcoin, mocked that STRC is building "the largest financial Trump Tower in history (an unstable structure)" and warned that "when it eventually collapses, a disaster awaits."

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