Bitwise says STRC selloff signals crypto cycle nearing a bottom, not Strategy’s breaking point
CoinDesk 2026-07-02 16:51:36
Context: Bitwise, a prominent asset manager, has stated that the recent sharp decline in Strategy's (MSTR) perpetual preferred stock, STRC, is a sign of a maturing crypto cycle rather than evidence of a looming crisis at the company. According to Bitwise CIO Matt Hougan, the volatility in STRC reflects a late-cycle leverage unwind, with institutions poised to replace Strategy as bitcoin's biggest buyer. This development is expected to mark a broader shift in Strategy's role within bitcoin markets.
Key Facts
- Bitwise CIO Matt Hougan stated that the volatility in STRC is a natural and important part of the crypto cycle, and that he thinks "we're nearing the bottom".
- Strategy's new framework shifts MSTR from a one-way bitcoin buyer to a more flexible capital allocator, allowing selective bitcoin sales to fund preferred dividends, while authorizing preferred share repurchases and stock buybacks.
- The asset manager expects institutional investors, including asset managers, banks, pensions, endowments, and sovereign funds, to become bitcoin's dominant source of demand in the next cycle.
- Strategy has roughly $52 billion in liquid assets against about $7 billion of debt, and its $2.55 billion cash balance currently covers about 17 months of preferred dividend and interest payments.
- Bitcoin was trading around $61,400 at publication time, while STRC was trading at $88, down from its intended $100 par value.