Bitcoin treasury firm Strategy is facing an investigation by Rosen Law Firm into potential securities claims involving the company's public disclosures to investors, as the company's securities remain under pressure from falling Bitcoin prices and shareholder dilution concerns. The investor rights law firm said it is reviewing allegations that Strategy may have issued materially misleading business information, covering the company's common stock and preferred securities including MSTR, STRF, STRC, STRK, and STRD. MSTR fell more than 9% to a 28-month low, while STRC touched a new all-time low near $74, placing it about 26% below its $100 par value. The investigation adds legal scrutiny to Strategy, one of the largest corporate Bitcoin holders, as the company navigates weakness in its preferred stock structure and an estimated $12.6 billion unrealized loss on its Bitcoin holdings.
Rosen Law Firm Announces Investigation Into Strategy Securities
Rosen Law Firm said investors who purchased Strategy securities may be entitled to seek compensation through a contingency fee arrangement if a class action proceeds. The firm said it is preparing a potential claim to recover investor losses, although no court finding of wrongdoing has been cited.
The review focuses on whether Strategy's public statements accurately reflected the company's business condition, Bitcoin treasury strategy, capital markets activity, and preferred securities obligations. Strategy, formerly known as MicroStrategy, has built its market identity around Bitcoin accumulation through capital raises, preferred stock issuance, convertible instruments, and equity-linked structures.
STRC Falls to $74 With Yield Near 15.3%
STRC has fallen to around $74, marking a 26% decline from its $100 par value. The drop has pushed the security's yield higher, with market analysts placing the current yield near 15.3%.
Earlier market analysis showed STRC had already fallen to $82.50 last week, then a record 17.5% below its $100 par value. The decline has occurred alongside a weaker Bitcoin market and concerns that Strategy's cash reserve has narrowed.
Strategy repurchased $1.5 billion of its 0% convertible senior notes due 2029 in May, reducing available cash that could support preferred dividend obligations. An analysis saw the company's U.S. dollar cash reserve has fallen 38% since the start of 2026, while annualized dividend obligations have risen to about $1.2 billion.
Strategy Reports $12.6 Billion Unrealized Loss on Bitcoin Holdings
Strategy holds approximately 847,363 BTC at an average purchase price of about $75,651 per coin. With Bitcoin recently trading near $59,000 to $61,000, the company is sitting on an estimated aggregate unrealized loss of about $12.6 billion on its Bitcoin holdings.
Peter Schiff Criticizes Strategy's Bitcoin Model
Economist Peter Schiff intensified his criticism of Strategy's Bitcoin strategy as MSTR and STRC continued to fall. Schiff said MSTR's share price had dropped below $85.50 and argued that the stock could begin trading at a deep discount to the company's Bitcoin per-share value.
Schiff said the decline in STRC, which recently traded about 24% below its issue value, shows growing pressure on Strategy's preferred stock structure. He also pointed to STRC's rising yield, which is near 15.3%, as a sign that investors are demanding greater compensation for holding the security.
According to Schiff, Strategy's current position leaves the company with fewer attractive options. He argued that issuing new securities while MSTR and STRC remain under pressure could weaken shareholder value, while selling Bitcoin at current prices would realize losses on coins purchased at higher levels.
Schiff said the company's best route to create shareholder value would be to sell part of its Bitcoin holdings and use the proceeds to repurchase discounted MSTR shares. In his view, buying back stock could help narrow any gap between MSTR's market price and the value of Bitcoin held per share.
FAQ
What is Rosen Law Firm investigating about Strategy?
Rosen Law Firm is reviewing allegations that Strategy may have issued materially misleading business information to the investing public. The investigation covers whether Strategy's public statements accurately reflected the company's business condition, Bitcoin treasury strategy, capital markets activity, and preferred securities obligations.
Why did STRC fall below its par value?
STRC fell to around $74, about 26% below its $100 par value, due to falling Bitcoin prices, concerns over shareholder dilution, and weakness in Strategy's preferred stock structure. The decline pushed STRC's yield to near 15.3%, with the security having traded at $82.50 last week, 17.5% below par.
What is Strategy's unrealized loss on Bitcoin holdings?
Strategy holds approximately 847,363 BTC at an average purchase price of about $75,651 per coin. With Bitcoin recently trading near $59,000 to $61,000, the company has an estimated aggregate unrealized loss of about $12.6 billion on its Bitcoin holdings.
