Strive Blames Leverage Liquidations After SATA and Bitcoin Giant Strategy's STRC Plunge
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“Digital credit” preferred share offerings from Bitcoin treasury firms suffered their worst day ever on Thursday, according to Strive CEO Matt Cole, who called out leveraged positions as the culprit behind price plunges while defending the quality of the underlying credit instruments.
Key facts
- Both SATA and STRC are designed to trade around $100 per share, but during Thursday’s trading period, SATA sank as low as $92.88 while STRC dipped even further, finding a daily bottom of $82.53
- Both SATA and STRC saw outsized trading volumes on Thursday, notching their second- and fourth-largest trading days with $153 million and $941 million respectively, according to data shared
- Shares in Strive (ASST) fell 3.8% to $14.85, moving its monthly losses to nearly 6%
- At the close of trading on Thursday, MSTR had fallen a further 3.46% to $112.53, now down more than 32% in the last month of trading
Summary
Strive CEO Matt Cole called Thursday's preferred equity performance the "most difficult day ever" for digital credit products. Strive's SATA and Strategy's STRC fell further from their par values, potentially because of unwinding leverage positions. The assets are designed to trade around $100, but closed the day below their marks at $97.71 and $88.59, respectively. Cole’s comments follow the Thursday price plunges for SATA and STRC, the respective preferred equity and digital credit products from his firm and Bitcoin treasury giant Strategy, falling well below their par values, or the price they are designed to trade near.