u/_Adrian_Morris_

10 weeks later, through 9-27, Strategy has spent ~$1.28B on STRC buybacks, retiring obligations on 13.27M shares. Over the ongoing buyback window, that spending is equivalent to ~19.42% of dollar trading volume. Strategy has no doubt provided a substantial bid, but how much of the rebound can (or should) be attributed to it?

Between 6-26 and 7-17 (before the first reported purchases), STRC had already rebounded [14.38%], BTC gained [7.47%], and MSTR rose [15.24%]. The other Strategy preferreds also recovered: STRK [+14.76%], STRF [+13.91%], and STRD [+12.21%].

From 7-17 through the 9-30 close, BTC gained another [30.33%] and MSTR [61.40%], while STRC gained [16.48%] from $85.29 to $99.35. Over that same period, STRK gained [20.14%], STRD [21.00%], and STRF [7.68%]. The other Strategy prefs did this with no intervention and no buybacks.

To be fair, the other prefs are different instruments, with different risks, so this isn’t an apples-to-apples comparison. Nonetheless, this context makes a buyback-driven STRC recovery difficult to defend.

My Read: The driving force is the broader recovery across BTC, MSTR, and Strategy’s capital structure; claims that credit the STRC rebound to the buybacks are comforting narratives. After over $1B spent, I also think that the market is trading Strategy’s buyback intervention itself, rather than STRC itself.

Once market sentiment shifted early this summer and BTC dropped below $60K, the capital structure fell with it. The “x-factor” with STRC was leverage, which IMO accelerated and worsened the unwind from par.

TL/DR: STRC has the biggest footprint, is designed to have lower volatility than BTC and thus is slower to move. Leverage takes it down on an elevator; the Capital Structure takes it back up with the stairs.

My original question still remains: will STRC sustain healthy trading near par when Strategy’s intervention steps back? This will tell us a great deal about how the market is forward-pricing BTC near term and will test market demand for Strategy Digital Credit.

While some chose to engagement farm DOOM over the Summer, smart money was buying the lows. Be mindful of who you listen to.

I think much of the conversation around $STRC | $SATA and dividend rate(s) is missing a critical point: Proximity to Bitcoin and the respective issuers is central to understanding why STRC (and SATA) carry the highest stated dividend rates among the five Digital Credit offerings.

The rate is not simply SOFR plus a spread. Strategy’s own guidance says they review trading levels, market yields, credit spreads, $BTC price and volatility, USD Reserve coverage, capital market conditions, and capital structure together. The dividend rate(s) compensate holders, in part, for risk in the capital structure that flows from $BTC and the respective issuer. And the path of $STRC moving that rate from 9% at launch to 12% (as of September 2026), in my view, reflects that risk premium being discovered in real time.

In the case of $SATA, I view the higher dividend rate as partly reflecting a different issuer risk profile: a smaller issuer with a smaller $BTC balance sheet. The key is the coverage that $BTC provides relative to the issuer’s obligations, alongside its liquidity. The rate (and frequency) are product features; I see the higher rate as compensation for the additional risk holders are taking.

An offering with a 12% stated dividend rate does not necessarily attract the same investor cohort as a bank-issued preferred like JPM-PC or WFC-PL. These Bitcoin-derivative perpetual preferreds naturally appeal to a different cohort; one native to (and familiar with) $BTC risk, yield-seeking, and, in some cases, leverage. Which, ironically, is what Phong Le pointed to as a contributing factor in $STRC volatility: they did not expect that amount of leverage to build up.

The product isn’t broken; it’s finding market | cohort fit, driven by the TAM of its investor base as it scales alongside $BTC on the balance sheet, not by dividend frequency or rate alone.

Over the same 215 sessions through September 18, both offerings closed in the $95–$99.99 band most days, with $STRC spending more time at or above $95 than $SATA did: 78.1% versus 69.8%. $STRC also spent more time below $90 [14.4% versus 5.1%], and that detail matters. To me, this is consistent with the product finding the market cohort willing to hold a BTC-derivative | BTC-linked pref. I don’t read it as evidence of a failed offering.

https://preview.redd.it/nepzq0e6dirh1.png?width=3200&format=png&auto=webp&s=4bee59497c1dac77f95d88d93394a6d533857ca6

Weird... It's almost as if BTC | MSTR needed to go ⬆️ for STRC to start to stabilize. (TL/DR: Buybacks retire obligations, they don't move the price back to par)

Remember the Crypto | Finance bros with hundreds of thousands of followers that said STRC was in a "death spiral" and it was Terra Luna 2.0?

Objectivity takes an investor far in capital markets.

Ignore the fear mongers.

We’ve had 7 weeks of STRC buybacks, here's where we stand:

[1] $811.5M | 8.54M shares repurchased at a $95.01 average
[2] $4.60B | 48.99M shares traded across the same window
[3] Buybacks were 17.63% of dollar volume | 17.43% of share volume
[4] Average purchase price rose from $86.53 in week 1 to $97.36 in week 7.

In my opinion, when Strategy signaled it would intervene in a market it created, participants started trading the intervention as opposed to trading STRC. A discretionary buyer can change how participants trade an instrument and a known, finite, optional bid with a stated budget is exactly the setup that invites a test of resolve from the market.

Sell into it; see how persistent the inorganic demand is, see where they step away.

The 9-8 increase of the Digital Credit Securities Repurchase Program from $1B to $2B lends credence to this view. A raise in the authorization after 7 weeks of providing a large visible bid is consistent with them responding to the market probing the “defense” of the instrument.

After $811.5M of STRC buys, most of the original allotment was used and price still wasn't at $99-$100 at the end of the window. So now the Board has doubled the allotment and $1.19B remains.

Remember: the float is still intended to be elastic and new issuance likely resumes once price recovers above $100.01, so any scarcity from buybacks is temporary. And if the program has to be recalibrated as they learn from the market, it is an adaptive response, not a lever.

Bottom Line: Weekly spend on buybacks rose from $25M to $176.3M, while buybacks went from 5.46% to 22.36% of dollar trading volume. Now the question that we have to contend with is this:

How much independent demand remains when Strategy steps back?

My concern is a renewed test of the bid, but “the why” behind them stopping matters. Them stepping away from the bid because demand has recovered is different from stepping away while demand remains weak.

From its inception through 9-4-26 STRC has outperformed BTC.

Assuming $10,000 invested over the same period:

STRC w/DRIP - $11,702.17 [+17.02%]
STRC No DRIP - $11,605.82 [+16.06%]
BTC - $6,761.86 [-32.38%]

As I mentioned in my post the other day on ASST; while most focus on short interest to get a read on positioning, daily short volume flow is what I use to get a more granular read on how shorting pressure manifests itself in trading activity.

I ran the same short volume analysis that I did on ASST for MSTR through 08-31-2026; needless to say, the scale of shorting volume on $MSTR is not inconsequential.

[1] On 08-31-2026, MSTR traded 24.23M shares; 2.93M shares were reported short, equal to a “market wide short flow ratio” of 12.10%.

[2] On 08-31-2026, there was ~$3.16B of total trading volume  (based on VWAP) with ~$382M of that volume reported short.

[3] This latest result was actually below the 5-day full-week average for MSTR, and also below the 20-day and 60-day averages for daily shorting volume.

[4] For the last full trading week: 08-24 to 08-28

• Average Short Volume: 5.27M Shares a Day
• Average Short Notional Value: ~$675M a Day
• Total Short Volume: 26.36M Shares
• Total Short Notional Value: ~$3.38B
• Average Short-Flow Ratio: 15.73% Of Trading Volume

[5] For the last 4 full trading weeks covering 08-03 to 08-28: 74.48M shares were reported short; representing ~$8.29B of VWAP estimated short sale notional value. This is the matter of scale that I want to shed light on, the absolute ratio of shorting as a proportion of trading volume is not always extreme, but the total dollar flow is massive because MSTR is the deepest, most high velocity BTC-equity trading vehicle in the market.

[6] To complement the shorting analysis, a Price | Short-Flow Correlation is a check I run  that provides useful context as a pressure and sentiment diagnostic. As of 08-31-2026, the 20-day rolling correlation between VWAP returns and the market wide short flow ratio stands at -0.49. This is a moderate inverse relationship that indicates elevated short-flow ratios have generally coincided with weaker returns over this 20-day period. This correlation sits at +0.53 at 5 days, -0.41 at 10 days and -0.47 at 15 days respectively.

[7] As mentioned before, daily short flow matters because it shows a real-time absorption burden that an equity must contend with. If hundreds of millions (or billions over certain periods) of dollars in short-sale notional repeatedly hits the market, that makes it a real market-structure variable that must be accounted for.

[8] My analysis on ASST shows that it has seen material shorting interest overall; compared against MSTR it has a higher proportional short-flow ratio. However MSTR lives in an entirely different liquidity regime. If we look across an overlapping sample covering the start of ASST BSE through 08-31-2026, MSTR averaged ~$601M of reported short-sale notional per day vs. ~$22.5M for ASST, or a ratio that is about 26.7x larger.

[9] If we look over the last 4 full common trading weeks, the MSTR daily short-sale notional value was still ~18.1x that of ASST with the most recent full trading week having short-sale flow of ~$3.38B, larger than the entire current market cap of Strive.

[10] Historically, MSTR has seen periodic regime-dependent explosions in shorting; during the week of 11-18-2024 to 11-22-2024 there was ~$23.10B of reported short-sale notional flow - on 11-21-2024 alone, that figure was ~$8.18B.

My Read: When looking at MSTR, we can't view shorting as a simple “bearish” signal or use it as a standalone “short squeeze” indicator. Some of it is directional, some is likely tied to forward-looking BTC positioning or bias, mNAV premium trades, options hedging, convertible bonds, capital-structure trades, and broader BTC proxy exposure. The complexity | convexity is the whole appeal of owning this equity. MSTR serves as a high velocity, high liquidity battleground for BTC linked leverage and exposure. The short sale flow tells me how that leverage and exposure is being expressed and how position conviction is being stress tested in real time.

Matt Cole noted that ASST is one of the most heavily shorted equities in the market, so I decided to take a more detailed look into shorting activity around the equity.

While most tend to focus on short interest to get a read on positioning, daily short volume flow is what I use to get (what I think is) a better and more granualar real-time read on how that pressure manifests in trading activity:

Some high level details, on 08-31-2026:

[1] ASST had 15.18M shares of aggregate trading volume, with 3.56M shares reported short. This represents ~23.43% of trading volume, think of this as a “market wide short flow ratio”.

[2] ASST had ~$356M in trading volume based on VWAP, ~$83.3M of that was from shorting.

Remember, this is active daily pressure, not a bi-weekly positioning number.

Recent trends worth noting:

[1]  Over the last 5 trading days, ASST averaged 2.50M shares reported short per day, or ~19.4% of aggregate trading volume.

[2] Over the last 20 trading days, this daily reported short flow totaled 28.64M shares and ~$537M of notional value (based on VWAP)

When doing statistical analysis, financial modeling or even simply when trying to get a more precise read on how the market is trading and where sentiment is trending, daily short volume is incredibly useful because it shows the intensity of selling pressure at daily and intraday increments.

Assessing reported short flow as a proportion of  total trading volume based on VWAP notional also gives you a path towards estimating how much incremental pressure the market has to absorb daily. This also facilitates modeling how pressure impacts the equity in dollar terms per share.

My Read: The data backs up Matt Cole’s observation about ASST shorting; it's not just carrying high short interest; the daily flow data also shows persistent, material short sale activity even as the equity has rallied over 100% in the last month. That kind of setup can create volatility, convexity, and reflexivity, especially if shorts are forced to cover into rising prices. This is exactly the kind of set up where investor conviction and market pain often collide.

Please note: The short interest is the stock of open short positions that gets reported biweekly, daily short volume is the flow of trades reported or marked short on a given day. Having high daily short volume does not mean that short interest rose. Shorts can be covered, offset, closed intraday, etc.

I think there is an under appreciated dynamic at play.

When the issuer of a preferred equity (in this case Strategy) signals that they are willing to use buybacks to intervene in a market they essentially created, that naturally changes how market participants trade the offering. There are a few aspects to this:

[1] Buybacks become a known or anticipated (inorganic) source of demand. There is no “schedule” to it per se, but the market will now anticipate a weekly presence.

[2] Because the buyback “support” is discretionary and limited in size ($364.8M of the original $1B under the Digital Credit Securities Repurchase Program remains available) the logical response is to test it. A finite, optional bid with a remaining budget is exactly the setup that incentivizes market probing. As a result, the market sells into the bid to see how persistent that inorganic demand is, and to see where the intervening force (Strategy) “steps away” so to speak.

[3] In this new set up, price action starts to reflect both the drivers of price (noted in {a} through {e} below) as the market perceives them, and a persistent test of Strategy’s resolve to defend the $99 to $100 target. The market starts trading their intervention, rather than (or in addition to) trading STRC. The existence of a finite discretionary bid changes the preferred's trading behavior.

[4] Share buybacks (and share issuance) leave a footprint in financial | trading data that is traceable, observable, and measurable. However small. That said, based on my analysis of STRC from inception to date, the buybacks have not been a “first order” driver of price variance. Could a hypothetical stabilizing bid reduce downside without showing up as a meaningful force on returns? Yes. But there is a distinction that matters; the signal from the existence of the program can change behavior; but the flow itself has barely registered against other factors.

[5] The most persistent and observable drivers of price variance have been {a} BTC {b} MSTR {c} the other Digital Credit instruments in their aggregate {d} Trading Volume {e} Daily Shorting Volume and flows. The new wrinkle the buybacks have added is that the market may be treating them as a signal to stress test. That is why I have said the buying, and the recalibration of the buys, makes buybacks reactive, essentially “a lever without a fixed fulcrum”, not a lever Strategy can reliably pull. Yes buybacks retire an obligation and may improve perceived payment risk at the margins but they don’t override the markets perception of BTC related risk or MSTR “parent equity” risk. To say nothing of the other factors. As a result, a return to par that stays at par still requires the “fulcrum” to improve.

[6] SATA runs about 15 to 25% of STRC’s dollar volume, (on a good day) and even on a good day it doesn't approach ordinary STRC flows, and it is a fraction of the issuance size. Thus persistent narratives around SATA stealing enough volume from STRC to keep it off the $100 target are just that, narratives. There is no evidence in the data of that kind of impact from SATA alone.

Summary of Activities: ~$602.8M Raised

[1] $50.7M was used to fund STRC dividends
[2] $369.7M was used to purchase 4,603 BTC
[3] $151.8M used to buyback STRC
[4] $30M added to USD Cash Account

As of 08-28-2026, MSTR is still showing re-acceleration:

EoW 08-14: ~$7.30B traded on ~76.2M shares
EoW 08-21: ~$19.48B traded on ~180.1M shares, [+166.7%]
EoW 08-28: ~$21.25B traded on ~165.7M shares, [+9.1%]

What's worth noting is this latest week saw total nominal dollar volume rise again, but share volume dipped from 180.1M to 165.7M, or -8.0% WoW. So part of the latest notional increase came from the higher share price, but liquidity still remained far above what we have seen during this recent summer lull.

My Read: The rise in BTC is creating legitimate, renewed engagement with the Strategy trade, and the market may be forward pricing a move in BTC.

EV_mNAV | mNAV | mAV Shown With 7-Day Oscillation Lines:

Latest EV_mNAV 1.000x | Premium +0.0%
Latest mNAV 0.791x | Discount - 20.9%
Latest mAV 0.737x | Discount -26.3%