Michael Saylor has defended Strategy's Bitcoin-backed capital strategy after its STRC preferred stock fell well below its $100 par value, drawing fresh criticism from market participants. According to a June 20 X post by Saylor, Strategy's Bitcoin and cash reserves currently exceed its outstanding debt by approximately $48 billion. He noted that the company has raised more than $60 billion in additional capital since 2022 and used those funds to acquire Bitcoin. To illustrate the contrast with today, Saylor pointed to Strategy's position during the 2022 crypto bear market, when the company held around 130,000 Bitcoin worth roughly $2.6 billion while Bitcoin traded near $20,000. "We stayed focused, strengthened the company, and executed our strategy. Since then, Strategy has raised over $60 billion of additional capital and invested it in Bitcoin, adding more than 716,000 BTC," Saylor stated. The comments arrived as investors debated the implications of STRC's recent decline and questioned whether the company's financing model remains sustainable.
Digital credit faced its first real stress test this week, as MicroStrategy's STRC preferred stock crashed, prompting critics to declare the Bitcoin-backed asset class dead. The asset class, which is less than a year old, experienced multiple pressures simultaneously including leveraged STRC positions unwinding while Bitcoin forms a bottom, capital competing with AI listings and crowded IPO pipelines. The selling pressure on STRC did not happen in isolation - the structure also fed on itself because STRC trades under par, Strategy has paused new share sales through its market program, limiting its ability to keep buying Bitcoin. Total value locked across DeFi fell from about $170 billion in October 2025 to near $72 billion now, marking a drop of more than 55% and signaling a broad flight from risk. However, analysts argue that a failure here is very unlikely, with Strategy holding enough cash to cover dividends for at least seven months and its Bitcoin reserve potentially funding payments for decades.
Recent pressure on STRC has prompted alternative proposals from market observers. As previously reported by crypto.news, Arca Chief Investment Officer Jeff Dorman suggested the company may eventually need to sell between $3 billion and $4 billion worth of Bitcoin to ease pressure on its capital structure and support STRC holders. While Dorman assigned a 25% probability to that outcome, he said his base-case scenario, with a 70% probability, involves Strategy continuing to sell small amounts of MSTR stock. Under that scenario, Bitcoin holdings would remain largely intact, though common shareholders could face additional downside. Separate concerns have also emerged around liquidity, with market maker QCP previously estimating that Strategy's available resources could cover preferred dividend obligations for roughly seven and a half months. QCP added that if existing financing channels become less attractive, alternative funding options may eventually be required, with Bitcoin sales remaining one possible path.
While criticism has intensified, several Bitcoin advocates have publicly defended Saylor and Strategy. Fox and Sky News contributor David Gokhshtein argued on X that Bitcoin's current market value cannot be attributed to a single individual. He criticized efforts to blame Saylor for broader market movements and dismissed comparisons between Strategy and the collapsed Terra ecosystem. Those comparisons gained traction after crypto analyst Ali Martinez suggested similarities between STRC and Terra's LUNA token structure. Responding to the debate, Bitcoin advocate Samson Mow described STRC as a "brilliant instrument" and stated that he sees no structural flaw in the security unless investors believe Bitcoin will fail to appreciate over the long term. The divergence between falling prices and rising activity suggests both asset classes still have a pulse, with the core tension being the gap between declining prices and rising usage that rarely persists for long.
Bitcoin trades near $62,400, down about 3% on the day and far from its highs, as both digital credit and the Bitcoin network have been written off before. The timing of doubts about digital credit growing louder exactly as Strategy's preferred shares slid below par tells its own story. The gap between falling prices and rising activity rarely sits together for long, suggesting both asset classes still have a pulse. Whether STRC reclaims par and network activity keeps climbing will decide if this moment marks a bottom or a warning for the digital credit sector. The data suggests both digital credit and the Bitcoin network still have a pulse, with the core tension to watch being the divergence between falling prices and rising usage that rarely persists for long.
