Strategy's STRC preferred shares dropped as low as $82.50 on Friday before rebounding, while Strive's SATA slid from near par into the low $90s and recovered. The moves rattled a corner of the crypto market that has ballooned to roughly $10 billion in less than a year — perpetual preferred shares offering double-digit dividends of 11% to 13% and designed to trade around $100.
Forced liquidations behind the selloff
Some investors had borrowed against the shares to amplify returns. When prices fell, those leveraged positions got unwound. Parker White, who follows the space, said STRC's decline to $82 pointed to a forced liquidation event, with heavy midday trading consistent with brokers selling out clients. Strive CEO Matt Cole described the volatility as a leverage liquidation, not a sign of weakening credit. He said dividend reserves remained intact.
Short sellers added pressure
Short sellers may have accelerated the plunge, pressing prices lower and triggering more forced sales. The combination of liquidations and short selling created a feedback loop that sent both tickers well below their target price before buyers stepped in later in the session.
Issuers say fundamentals intact
Neither company sees lasting damage from the episode. Strategy is the largest public Bitcoin holder. Jesse Myers noted that the company's balance sheet hasn't changed just because STRC traded lower, and that Strategy could continue paying dividends for decades. Still, the rout underscores how the leverage built into these yield products can amplify losses when the market turns.
