Glenn Cameron@GlennOnrampBTC
The question every investor in MSTR’s securities should be asking is this.
Why would Saylor do this if the funds came from STRC issuance and they now have to pay 11.5% yield on the capital
This move only makes sense if you ignore the 11.5% coupon on where they got the capital from (STRC issuance) and start reading the put schedule on the convertibles
Those 2029 convertible notes were 0% on paper, but they had a holder put in late 2027 at par, so the functional maturity was two years, not five.
With MSTR at ~$187 against a conversion strike around $672, the converts are deep out of the money and every rational holder would have put them back in 2027.
Strategy is staring at a ~$3B liquidity event in 24 months. They’re paying ~92 cents on the dollar now (a $120M discount to par capture) to chip the wall down before it hits, while STRC retail demand is still running hot enough to absorb the refi.
The narrative they’re selling (“rotating $6B of convert debt to equity over 3-6 years” is only coincidentally and partly true, because it’s really maturity-wall management that they’re trying to propagandize as strategic discipline.
The why transform 0% convertibles into 11.5% STRC question is exactly the right one to ask though, because it exposes what’s actually happening underneath.
A zero-coupon convert is a finite obligation: it either converts away into shares if BTC runs, or it has to get refinanced.
STRC is perpetual. They’re swapping a self-extinguishing instrument for a permanent claim that compounds forever against common shareholders forever at 11.5%, on a base that’s already $10.7B and growing. The trade is only accretive if BTC compounds materially above the preferred cost of capital net of all dilution.
And the real tell is buried in the 8-K
They listed Bitcoin sales as one of three potential funding sources. The self-styled “net accumulator” and before that “we’ll never sell our BTC” is now openly contemplating selling spot BTC to retire 0% debt and refinance through 11.5% retail preferred.
That’s not “BitVac charging”, that’s the ponzi style flywheel borrowing forward from STRC holders to manage a near-term liquidity gap, with the bill arriving as perpetual yield obligations on retail balance sheets.
And just before the inevitable attack that will come after I post this, I am a Bitcoin maximalist. This is not an attack on Bitcoin. This is a criticism of Strategy and STRC. Most of you have forgotten what Bitcoin is, and Bitcoin does not equal STRC, or for that matter MSTR, which are securities, not bearer assets or Bitcoin
