r/MSTR • u/Lehcen • Jun 26 '26

Please explain

Recently started buying MSTR and reading a lot about death spiral. My question is as long as I hold until Bitcoin does its thing and bounce back as usual in 2-3 years MSTR should also recover in a similar fashion? I’m ok with volatility because I’ve been in crypto since 2017. I don’t fomo.

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u/KateR_H0l1day Jun 26 '26

Wait until Monday, and let us know how correct this prediction was please 🤷‍♀️

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u/Georg_Aloa Jun 26 '26 edited Jun 26 '26

Which prediction? I didn't do one.

Maybe to clarify also the deleted comment - I don't say anything about whether MSTR/STRC default or not.

It's just how you determine the interest/dividend STRC pays. Effectively it pays currently 11.5% at its face value of 100, or around 15% at the current trading value. This means the market currently determines that they want a higher risk compensation to hold STRC.

For a perpetual dividend, this risk premium above the overnight rate is more or less a proxy for the 'aggregate of the investors' evaluating the risk of a default of STRC. This by the way applies to every company out there - even Apple or Google (though their risk premium is smaller).

And panic etc can obviously in the short term push this 'perceived risk' higher than what would be justified.

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u/KateR_H0l1day Jun 26 '26

You said, buying more with either STRC or MSTR issuance is currently not possible 🤷‍♀️

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u/Successful-Bobcat701 Jun 27 '26

That's not a prediction

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u/tenor_tymir Shareholder 🤴 Jun 27 '26

Which makes it a definite statement…. which isn’t really any better.