Strategy and Strive are relying on perpetual preferred stock to help finance bitcoin purchases, but the fundraising model is creating a growing obligation to pay dividends. According to CoinDesk, Fidelity Digital Assets estimates that preferred-stock offerings funded the purchase of 135,979 bitcoin between the start of 2025 and Oct. 5.
That total represents more than 0.5% of bitcoin’s maximum supply and shows how corporate financing vehicles have become an additional source of demand for the cryptocurrency. The approach, however, requires treasury companies to balance new bitcoin purchases against the cost of maintaining investor interest in their preferred shares.
Preferred stock becomes a bitcoin funding channel
Strategy, the largest corporate holder of bitcoin, is the leading example of the model. The company has five preferred-stock classes, with its first offering, STRK, launching in February 2025. Strive is another bitcoin-focused treasury company using similar securities.
Perpetual preferred shares generally sit between debt and common equity in a company’s capital structure. They pay regular dividends, do not have a fixed maturity and typically do not give holders voting rights. Because they do not require repayment on a set date, they can reduce the refinancing pressure associated with conventional debt.
For investors, the securities offer a way to seek income while gaining exposure to companies whose finances are linked to bitcoin. That can appeal to buyers who are reluctant to hold bitcoin directly or to use a spot bitcoin exchange-traded fund (ETF).
Fidelity analyst Zack Wainwright estimated the bitcoin-focused preferred-stock market at about $12 billion. That remains small compared with the roughly $150 trillion global fixed-income market, indicating that the preferred market is still limited relative to traditional bonds and other income investments.
Yield attracts a different investor base
Analysts see preferred shares and bitcoin ETFs as complementary rather than identical products. Mark Palmer, a senior equity research analyst at StoneX, said perpetual preferred securities have introduced bitcoin-related exposure to income investors who were not reached by ETFs.
Ryan Rasmussen, head of research at Bitwise, likewise expects the preferred offerings to attract a different group of buyers. He said ETFs should remain the larger source of bitcoin demand over the long term, while perpetual preferred stock can provide a secondary boost by targeting yield-focused investors.
The income comes with a continuing cost for the issuer. James Butterfill, head of research at CoinShares, said Strategy’s STRC offering had raised $7.5 billion during 2026 through late July and was paying a variable dividend of about 12% at the time of his comments.
The securities are not simply a direct bet on bitcoin’s price. Their value can also reflect management decisions, the issuer’s dividend obligations and broader capital-market conditions. Alex Blume, founder and chief executive of institutional bitcoin asset manager Two Prime, pointed to STRC’s brief decline into the $70 range in late June as an example of the volatility investors may face. Strategy’s preferred stock was trading at around $99.40 in the source material.
Buybacks compete with bitcoin purchases
The funding strategy becomes more difficult when preferred shares trade below their issue price, or par value. New issuance is less attractive in that situation, and the company may choose to repurchase existing shares instead of raising fresh capital.
Butterfill said Strategy’s latest weekly update showed $193 million spent on STRC buybacks, compared with purchases of only 267 bitcoin. The company also increased its authorization for preferred-stock repurchases to $3 billion.
Buybacks can reduce future dividend commitments by shrinking the number of shares outstanding. At the same time, they use capital that could otherwise be directed toward additional bitcoin purchases. This creates a three-way tension: increasing bitcoin held per common share, meeting dollar-denominated dividend obligations and avoiding bitcoin sales.
Cash reserves can provide a temporary buffer, although Butterfill said Strategy had already sold some bitcoin to help fund preferred dividends. The model therefore depends not only on bitcoin prices, but also on the ability of the securities to continue attracting buyers near par value.
ETFs remain the larger demand channel
The preferred-stock market is developing alongside a much larger U.S. spot bitcoin ETF market. Butterfill said those ETFs had attracted approximately $57 billion in cumulative net inflows and held about $106 billion in assets.
ETF creations generally require funds to acquire more bitcoin, while preferred-stock issuance gives company management discretion over how the proceeds are spent. ETF redemptions can reverse that demand, but they do not create an ongoing dividend obligation for the ETF sponsor. Preferred shares, by contrast, leave issuers with recurring payments even when market conditions become less supportive.
Butterfill described preferred stock as an amplifier of the broader cycle: it can support bitcoin buying when financing conditions are favorable, but that support may weaken as investor sentiment deteriorates.
Moneyiar market picture
Moneyiar market data at the stated times showed bitcoin at $80430.506808014, down 0.08% over 24 hours and 1.32% over seven days, as of 2026-10-25 22:39 +03:30. NEAR Protocol was $4.6166906773, up 3.36% over 24 hours and down 6.21% over seven days, as of 2026-10-25 22:38 +03:30.
Compound stood at $21.1287447338, down 10.42% over 24 hours and up 0.3% over seven days, as of 2026-10-25 22:39 +03:30. OpenLedger was $0.0976845525, up 2.83% over 24 hours and 3% over seven days, as of 2026-10-24 15:23 +03:30.
