Cryptoquant warns STRC vulnerable to long bitcoin flatline

Cryptoquant CEO Ki Young Ju warned that a long period of little or no price movement in bitcoin could weaken the Variable Rate Series A Perpetual Stretch Preferred Stock, known as STRC, that Strategy issued to fund bitcoin purchases. Strategy executive chairman Michael Saylor rejected the assessment and said, “Bitcoin keeps working. So do we.”

Ki argued that a multi-month or multi-year sideways market reduces investor interest and can strain financing tools built around bitcoin. He noted lower capital inflows into crypto in 2026 as some investors shifted attention back to equities and other assets. Ki has described a prolonged flat market as a larger operational risk to certain yield products than a rapid price crash.

STRC launched in July 2025 and pays a monthly-adjusting dividend that is currently set at 11.5 percent. The preferred stock was designed to trade close to a $100 par value while raising cash that Strategy uses to buy bitcoin without issuing conventional debt or diluting common equity. Public documents and company filings show STRC grew rapidly and its proceeds funded roughly 77,000 BTC of Strategy’s purchases in 2026.

STRC’s market price has slipped toward about $85 from the $100 par target, a decline of about 15 percent. Bitcoin traded in the low- to mid-$60,000s in June, and net inflows into spot bitcoin funds were smaller than amounts Strategy raised through STRC during parts of 2026.

Strategy holds more than 800,000 BTC and sold bitcoin for the first time in four years to help cover preferred dividends; that sale coincided with a drop in Strategy’s share price. Market participants have pointed to STRC’s yield and recent price drift when assessing the preferred stock’s capacity to continue funding bitcoin purchases.