The nascent digital credit market suffered one of its most turbulent sessions on Thursday as two prominent preferred equity instruments linked to Bitcoin treasury companies experienced dramatic intraday price swings. Strategy’s (NASDAQ:MSTR) STRC and Strive’s (NASDAQ:ASST) SATA both plunged sharply below their typical $100 par value before staging notable recoveries.
STRC, Strategy’s Variable Rate Series A Perpetual Stretch Preferred Stock, fell as low as $82.50, while SATA, Strive’s own Variable Rate Series A Perpetual Preferred Stock, dropped into the low $90s—some reports showing an intraday low around $92.88. Both instruments are designed to provide attractive yields with relative price stability near par, backed by the issuers’ substantial Bitcoin holdings.
Matt Cole, Chairman and CEO of Strive, called it “the most difficult day in the history of Digital Credit.” In a public statement, he stressed the moves were a classic leverage-driven unwind, not a credit event. Investors had borrowed against their positions to amplify returns, and when prices slipped, margin calls triggered forced selling, creating a self-reinforcing cascade. Cole emphasized there were no defaults, Strive’s dividend reserves remain well-supported, and the fundamental credit profile was essentially unchanged. He pointed to the sharp recovery on visible buying demand as proof of underlying market health.
This perspective was echoed by JAN3 CEO Samson Mow, who argued that STRC’s design incorporates a self-repairing mechanism. When the security trades below par, the effective dividend yield rises for new buyers, and the discount builds in a capital gain runway if the price returns to par or is redeemed at face value. Mow explained that this pull-to-par math naturally attracts buyers without the need for issuer intervention, making the discount itself a catalyst for demand. He framed the structure as an automated incentive aligned with broader crypto-native concepts, though he acknowledged the thesis would be tested if a prolonged risk-off environment deepened the discount.
