STRC Par Value Collapse...Is Strategy (MSTR) About to Unleash a Bitcoin (BTC) Selling Spree?

▲ Strategy (MSTR), STRC, Bitcoin (BTC)/AI generated image

Strategy (MSTR)'s Bitcoin buying strategy, coupled with STRC's discounted trading, has emerged as a new source of instability in the cryptocurrency market. The market is reacting more sensitively to dividend resources and the possibility of forced selling rather than additional purchases.

Paul Barron, host of the cryptocurrency YouTube channel Paul Barron Network, claimed in a video uploaded on June 25 (local time) that “Strategy and STRC have entered a doom loop.” He diagnosed that STRC falling below its par value is shaking investor sentiment across Strategy's stock price and the overall Bitcoin (BTC) market.

Barron also saw the macroeconomic environment turning unfavorable for Strategy. He said, “Now is the worst time to look at STRC's problems.” According to the video, US May Personal Consumption Expenditures (PCE) inflation rose to 4.1%, the highest level since April 2023. Core PCE inflation also rose to 3.4%, presented as the highest level since October 2023.

The key issue is STRC's dividend resources. The video claimed that Strategy's dividend payment capacity has decreased from approximately 7 years to about 14 months. Barron pointed out that if Strategy chooses to preserve cash, its Bitcoin buying strategy would weaken, and if it sells Bitcoin, the market could interpret it as a bearish signal.

Questions were also raised about Strategy's Bitcoin holding strategy. The video reported that Strategy purchased 520 BTC this week for approximately $34.9 million. The average purchase price was mentioned as $67,068. Barron believed that “the market can no longer give MSTR the same premium as in the past.”

The controversy surrounding the STRC name and legal risks also heightened anxiety. The video criticized that STRC was once described as a dividend-based stablecoin. It also mentioned that the Rosen Law Firm has opened an investigation related to Strategy and STRC. Barron argued, “If no new funds come in, at some point, Strategy might have to sell Bitcoin.”

Barron believed that the STRC problem is not limited to a single product's weakness. He warned, “Bitcoin price, MSTR stock price, DeFi, and even discussions on US cryptocurrency market structure legislation could all be shaken together.” The video's conclusion is that risk management is more important than opportunity cost in the current market.

*Disclaimer: This article is for investment reference only, and we are not responsible for investment losses based on it. The content should be interpreted for informational purposes only.*