Overview
- STRC plunged to about $82.50 and SATA dipped into the low $90s during heavy trading before both partially recovered toward roughly $89 and the high $90s after Thursday’s selloff.
- Strive CEO Matt Cole characterized the moves as a “leverage liquidation event” and said the firms’ dividend reserves remained intact, asserting the price moves were not a credit failure.
- Trading volumes spiked as leveraged positions were closed out, with Strive’s chief risk officer reporting outsized intraday turnover consistent with forced selling.
- Strategy’s earlier disclosure that it sold 32 BTC to fund preferred distributions and its move to semi‑monthly payouts have amplified investor concern by changing the funding narrative.
- The episode exposes structural risks in the roughly $10 billion digital‑credit market and is likely to prompt tighter brokerage margin rules and force issuers to choose costly fixes such as higher coupons, buybacks, equity raises, Bitcoin sales, larger cash reserves, or accept a lower price baseline.