Bitcoin Plunges, but Michael Saylor Says STRC Still Delivers Gains - Bitcoin News
Bitcoin plunged more than 21% over one month to trade near $64K on Nov. 14, pushing Strategy's holdings below acquisition cost, while Michael Saylor highlighted positive returns from the company's income-paying preferred shares STRC.
Bitcoin dropped to $64,428 on Nov. 14, down 5.85% over 24 hours, 14.37% over seven days, and 21.21% over one month, according to market data. The slide pushed Strategy's bitcoin holdings further below their acquisition cost. Valuing the company's 850,364 BTC at current prices produces approximately $54.79 billion, against a $64.16 billion purchase cost, implying an unrealized loss of about $9.37 billion.
STRC Returns Beat Bitcoin
Despite bitcoin's decline, Strategy's preferred stock STRC delivered positive returns, according to founder Michael Saylor. He compared STRC's performance with bitcoin's price movement on social media platform X on Nov. 14.
Bitcoin is Digital Capital. Strategy transforms it into Digital Credit. Over the past month, bitcoin fell 17.3%. STRC's price was essentially flat, and dividends brought its total return to +1.0%.
Dividend Model Faces Scrutiny
STRC carries a 12% variable annualized dividend rate, amounting to $12 per $100 stated amount per share if unchanged. The preferred shares' distributions depend on corporate funding, creating a financial claim on the issuer rather than direct ownership of bitcoin. Economist Peter Schiff criticized the sustainability of STRC payments on Nov. 12, questioning assumptions about long-term bitcoin appreciation supporting the model.
Company Actions Amid Volatility
Strategy continued buying bitcoin and repurchasing STRC shares during Nov. 2-8, purchasing 1,036 BTC for $81.9 million while spending $188.3 million to buy back 1,887,464 STRC shares. The company maintained a $4.77 billion designated dollar reserve for preferred-stock dividends and debt interest, using $21.1 million from this reserve during the week to pay STRC dividends.
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