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Michael Saylor seeks to restart the Strategy financing engine: the proposal for daily dividends on preferred shares may pass

According to Bloomberg, Strategy's Executive Chairman Michael Saylor is seeking to adjust the dividend mechanism for the company's preferred shares, proposing to change the dividend payment from bi-monthly or quarterly to daily for billions of dollars in preferred stock. The annualized yield on the related securities can reach up to 12%, and Saylor stated that this move would help improve liquidity and market efficiency.Previously, Strategy primarily raised funds by selling common stock to purchase Bitcoin, but as the premium of common stock relative to its Bitcoin assets disappeared, the company shifted to issuing perpetual preferred shares that do not dilute the equity of common stock shareholders. Such securities have no fixed repayment date and can provide a new source of financing for Strategy. The company currently has over $14 billion in preferred shares outstanding. Although the company has repurchased over $1 billion of floating-rate preferred shares STRC, it has still been unable to issue new STRC since May.Analysts pointed out that increasing the frequency of dividend payments mainly reduces dividend-related volatility, cannot eliminate credit and Bitcoin price risks, and may not necessarily enhance market liquidity. The shareholder vote on the proposal will conclude on October 28. Given that Saylor is the main shareholder of Strategy, the proposal is expected to pass.

first_img Castle opens Bitcoin savings stack to individuals, with dividends redeemable for Bitcoin at any ratio

According to Bitcoin Magazine, the Bitcoin fintech company Castle announced that it will open its automated Bitcoin financial stack to individual users and launch a pioneering feature in this category: users can choose to receive dividend income in cash or Bitcoin at any ratio.Castle's revenue comes from the perpetual preferred stock STRC issued by Strategy, which was incorporated into the platform earlier this year and currently pays an annualized dividend of 12% on a semi-monthly basis. Users can receive 100% of the dividends in cash, convert 100% to Bitcoin, or choose any ratio between the two. According to the company, most users opt for a compromise solution, using cash to cover daily expenses while automatically reinvesting the remaining portion into Bitcoin with each dividend payout.Castle co-founder and CTO João Almeida stated that investors have long faced a dilemma of choosing between stable income and holding Bitcoin. Castle allows users to achieve both cash flow and long-term upside by automatically converting a portion of the dividends into Bitcoin. Previously, Castle only catered to business clients such as restaurants, gyms, accounting firms, and e-commerce; the opening of personal accounts was due to repeated requests from business owners. Castle was co-founded by Almeida and CEO Stephen Cole and has received investments from Boost VC and Winklevoss Capital.
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