MicroStrategy Faces $13B Bitcoin Loss as STRC Preferred Drops 25%
MSTR•MicroStrategy holds 847,363 Bitcoin at an average cost of $75,500, leading to an unrealized $13 billion loss as BTC trades near $60,000. Its STRC preferred shares plunged 25% from par to around $75, forcing reliance on a $1.4 billion cash reserve that covers just ten months of $1.2 billion annual dividends.
1. Bitcoin Holdings and Unrealized Loss
MicroStrategy holds 847,363 Bitcoin at an average acquisition cost near $75,500 per coin, resulting in a roughly $13 billion unrealized loss as market prices hover around $60,000.
2. Preferred Stock Plunge and Dividend Strain
The STRC preferred shares have fallen about 25% from their engineered $100 par value, trading near $75, while annual dividend obligations total approximately $1.2 billion.
3. Cash Reserves and Coverage Period
The company’s $1.4 billion cash reserve covers roughly ten months of preferred stock dividends, raising questions about liquidity management if Bitcoin prices remain depressed.
4. Capital Structure Pressure and Legal Challenges
Investors and analysts are scrutinizing the firm’s leveraged dividend strategy as a securities probe examines potential misstatements, testing confidence in management’s long-term capital allocation.
