Strategy's Problem Isn't Bitcoin. It's That One Man Decides Everything.

A week ago, when Strategy's STRC preferred broke decisively below its $100 par, the question was whether it signaled real trouble or merely a passing scare. As we near the end of June, sky still falling, that question seems to have been answered.

STRC trades near $75 today, a record low at a 15% effective yield, after starting the week around $88. The common stock just hit $85, a two-year low, down 78% over the past year. Every one of Strategy's dollar-denominated preferreds is now below par. Within a few short sessions, a middling problem with one security became a rapid repricing of Strategy's entire company.

What changed was not bitcoin. BTC is indeed down, below $60,000 and more than 50% off its October high, but it has clearly held above its own low from the previous cycle. The same can not be said for Strategy's securities. What seems to have changed is that the market stopped treating Strategy as a bitcoin proxy and started pricing it as what it is: a leveraged bet on the decisions of one man whose grip on the company, through ten-vote shares, far outruns his economic stake in it.

Praxos Capital co-founder Vinny Lingham made a prescient call in October 2024, with MSTR near its 2024 peak, that was deeply unpopular at the time. Saylor, he said, would "do more damage to Bitcoin than FTX." This week the position came due.

In this issue, subscribers get:

• How Saylor kept an outsized share of the vote even as years of Class A issuance diluted his economic stake

• The two coverage numbers Strategy reports about itself, and which one actually governs what it can do

• Why the preferreds repricing in order of seniority means the market is pricing credit, not a liquidation

• An important rule individual crypto investors should remember

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