Strategy’s Michael Saylor says ChatGPT aided in designing STRC stock
Michael Saylor, the man who turned a mid-tier software company into the world’s largest corporate Bitcoin treasury, has added a new tool to his financial engineering kit: ChatGPT.
The Strategy chairman revealed that he used OpenAI’s chatbot to help design STRC, the company’s perpetual preferred stock known as “Stretch.” The instrument launched in July 2025 and has already accumulated a market capitalization exceeding $8.5 billion, making it one of the larger preferred equity offerings in the market.
What STRC actually is
It’s a perpetual preferred share, meaning it has no maturity date, pays dividends indefinitely, and sits in a priority queue above common stockholders if things ever go sideways.
The current annualized dividend rate is set at 11.5%. That’s variable, not fixed, which gives Strategy room to adjust as market conditions shift. The company has also explored moving to semi-monthly dividend payouts, a tweak designed to make the instrument more attractive to income-focused investors who prefer steadier cash flow.
The capital raised through STRC issuances isn’t collateralized by Strategy’s massive Bitcoin holdings. Instead, those funds are earmarked for purchasing more Bitcoin. So Saylor gets to keep stacking sats without pledging the existing stash as security. Investors get yield. Strategy gets more Bitcoin. The existing Bitcoin pile stays unencumbered.
Performance and the cracks
STRC hasn’t been a straight line up. The stock has traded below its par value at certain points, with prices dipping toward $90. For a preferred stock, trading below par is a yellow flag.
Saylor has pointed to the instrument’s Sharpe ratio, which reportedly exceeded 3 during some periods, as evidence that the risk-adjusted returns justify the volatility. For context, a Sharpe ratio above 1 is generally considered good. Above 2 is excellent.
The chairman has signaled willingness to make strategic adjustments, including potential share sales and dividend modifications, to maintain investor confidence.
What this means for investors
STRC sits at an unusual intersection. It’s a yield product for people who are at least somewhat bullish on Bitcoin, structured in a way that doesn’t directly tie their principal to Bitcoin’s price movements. The 11.5% annual dividend is attractive in a rate environment where traditional fixed income still struggles to match inflation-adjusted expectations for many investors.
Strategy’s entire corporate thesis rests on Bitcoin appreciation over time. If Bitcoin enters a prolonged downturn, the company’s ability to service an 11.5% variable dividend on a $8.5 billion preferred stock issuance gets tested in ways that no ChatGPT session can fully model.
The fact that STRC has already dipped below par suggests the market isn’t blindly accepting Saylor’s narrative. Price discovery is happening, and some of that discovery involves investors repricing risk in real time.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
The AI boom may follow the path of the 19th-century railway bubble, and builders may not be the ultimate winners
Goldman Sachs analyst Bobby Molavi compared the current situation to the 19th-century British railway mania: 500 companies spent more than the nation's annual income building 8,000 miles of railway, with most early investors losing out, while the real beneficiaries were the later "passengers." He pointed out that the current AI craze is driven by both debt and momentum, and that the S&P 500’s forward P/E ratio of 18x is only "a bit cheaper." Whether the builders can retain value is uncertain, and history does not offer an optimistic answer.
If Anthropic's IPO goes smoothly and the stock price rises next week, then everything remains the same for AI. Otherwise, some companies will go bankrupt.
The shrinking valuations of two major giants have triggered a chain reaction—investors are adopting more conservative revenue multiples for AI startups and are directly halting high-valuation financing for companies with zero revenue. Multiple venture capital firms have advised their portfolio companies to lower valuation expectations and to quickly build up cash reserves. Market participants warn that the outcome of Anthropic’s IPO will be a barometer for the industry: if successful, the boom will continue; if it fails, some companies may face elimination.
After the Brazilian election, political discount deepens; Morgan Stanley remains bullish on Petrobras (PBR.US), focusing on fuel pricing and dividends
Morgan Stanley still maintains its most optimistic "Overweight" rating, but has lowered its year-end 2027 target price from $31 to $25.
Corning (GLW.US) receives initial "Buy" rating from Jefferies! AI factories driving a fiber optic rush, with a potential global supply gap of up to 30%
For Corning, the recent profit growth mainly comes from the expansion of AI clusters. As the number of optical links crossing cabinets and campuses increases, customers need to deploy more optical fibers within limited conduit and cabinet space, thus driving demand for high-density optical cables and connection systems.
Crypto prices
More
