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Strategy Inc (NasdaqGS:MSTR) is issuing additional perpetual preferred shares, called Stretch, to fund continued Bitcoin accumulation.
The company is shifting more of its Bitcoin funding toward preferred equity instead of common equity to address concerns about dilution.
Management has reiterated plans to keep buying Bitcoin over the long term and has ruled out forced sales despite price volatility and large unrealized losses.
Strategy, trading at $133.88, has been closely linked to Bitcoin sentiment, which is reflected in its recent stock performance. The share price shows a 25.3% decline over the past 30 days and a 14.8% decline year to date, with a 60.4% decline over the past year. Even with these pullbacks, the 3 year return is very large, while the 5 year return stands at 38.9%.
For you as an investor, the key question is whether this new Stretch funding model and the commitment to ongoing Bitcoin purchases align with your risk tolerance and time horizon. The shift toward preferred equity changes how different investor groups are exposed to Bitcoin price swings, particularly institutions seeking digital asset exposure with a different risk and volatility profile than the common stock.
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📰 Beyond the headline: 2 risks and 2 things going right for Strategy that every investor should see.
For you, the key takeaway is that Strategy is doubling down on being a Bitcoin-treasury and software hybrid, and Stretch is the latest tool to support that. By tilting new funding toward perpetual preferred equity, management is trying to reduce further dilution of common shareholders while still adding to a 714,644 Bitcoin stack that currently sits on about US$4.5b of unrealized losses. The trade off is higher fixed dividend obligations on Stretch, with the rate recently lifted to 11.25%, which increases the company’s cash commitments at a time when reported net losses are already very large, including a US$12,436.65m loss in Q4 2025. The cloud and software business is still generating revenue, and subscription lines have been growing, but for equity holders the main driver remains Bitcoin exposure, not pure software fundamentals. Compared with other crypto exposed names like Coinbase or Robinhood, Strategy is far more concentrated in a single asset and uses equity and preferred funding to keep buying it. That concentration can appeal if you want focused Bitcoin leverage, but it also means execution on funding, liquidity and risk management needs to stay tight.
Read More: Strategy’s Stretch Preferreds Deepen Bitcoin Bet While Aiming To Limit
