Michael Saylor is tying Strategy Inc.’s income-producing securities to a much longer financial history. In a Nov. 7 analysis, the company founder and executive chairman traced the idea behind Stretch, Strategy’s variable-rate preferred stock traded as STRC, to four centuries of corporate finance.
From Dutch Shares to Preferred Stock
Saylor starts with the Dutch East India Company in 1602. Its transferable shares let investors sell out while the company kept the capital invested. He then points to Maryland’s 1836 financing for the Baltimore & Ohio Railroad as an early example of preferred stock. Later exchanges and securities rules gave trading and legal support. Saylor’s point is that digital credit did not appear from nowhere. It sits on old financial parts, even if the final product is new. “Digital credit took four centuries to make possible,” he said. That line is the core of his argument. Preferred shares get priority over common stock for dividends and for proceeds if a company is wound down. Creditors still rank ahead. Those rights are not the same as owning bitcoin. Payments depend on how the issuer runs its business and finances.
Stretch Adds Bitcoin Reserves
Strategy closed its first Stretch offering in July 2025. It raised about $2.521 billion before expenses and used net proceeds to buy 21,021 bitcoins. The shares have no scheduled maturity. A board-set monthly dividend policy is meant to keep trading near the $100 stated amount. Saylor also highlighted shelf registration and at-the-market programs. Shelf registration lets a company register securities in advance. At-the-market sales let it sell new shares at current prices. New issuance brings in capital; trading among shareholders moves ownership. Repurchases use company funds to retire shares and future dividend claims. Strategy disclosed $176 million in STRC repurchases in September and later expanded its buyback authorization. It reached $3 billion by October results, then followed with $208.2 million of STRC buybacks during Oct. 26 to Nov. 1.
Dividends, Taxes, and Risk
An amendment effective Nov. 1 changed STRC dividends to accrue daily, including weekends and holidays. Saylor also tied part of the structure to tax rules from 1921. A $12 distribution treated as return of capital would cut the basis on a $100 investment to $88, leaving a $12 gain on a later $100 sale, before other adjustments. Distributions above the remaining basis generally create capital gains. Risk remains. Schwab has noted that bitcoin treasury models can face earnings swings and liquidity pressure. STRC has no collateral claim on Strategy’s bitcoin, so payment capacity rests on the issuer’s resources. Strategy’s bitcoin sales for dividends and buybacks totaled about $431.8 million in 2026 through October results. Its Nov. 2 filing listed a $4.79 billion designated dollar reserve and $132.7 million in separate cash as of Nov. 1. During Oct. 26 to Nov. 1, it paid $43.4 million of preferred dividends from that reserve.
