Investors are mispricing risk for perpetual preferred stocks, like Bitcoin treasury company Strategy’s Variable Rate Series A Perpetual Stretch Preferred Stock (STRC), according to Matt Dines, the chief investment officer of credit asset management company Build Markets.

The corporate issuers of perpetual preferred stocks never have to repay holders their principal investment, and can just pay dividends indefinitely, without renegotiating the investment terms, Dines told the Truth for the Commoner (TFTC) media outlet.

If holders want to cash out, they must sell the perpetuals on the secondary market to recover their principal, which leaves holders exposed to liquidity contraction and interest rate risks that exist forever because perpetuals lack a maturity date, he said. He added:

“If spreads start to rise and the market demands higher yields from corporate borrowers, you also have to attach that to the infinite duration of the perpetual. So, if this dislocation comes in liquidity, it will come from the fiat side.”

Basic performance metrics for Strategy’s STRC perpetual preferred stock. Source: SaylorTracker

The analysis comes amid growing demand for STRC; on Thursday, its daily trading volume surged to $1.5 billion, a new record for the financial instrument, as Strategy leans into preferred stock issuance to fund its Bitcoin purchases.

Related: Strategy to repurchase $1.5B of 2029 convertible notes

Strategy’s preferred funding vehicle may hit a ceiling in the next year

STRC currently has an authorized issuance cap of about $28 billion, according to crypto research company Delphi Digital.

If the authorized issuance cap is not raised before the $28 billion threshold, the company’s BTC accumulation may slow down, Delphi’s researchers said. 

The total notional face value of outstanding STRC shares already sits at $8.5 billion, with the total market value of all outstanding shares at the time of this writing totaling about $8.4 billion.

STRC is trading at about $99 per share at the time of publication and carries a dividend rate of 11.5%, according to Strategy.

Detailed STRC performance metrics. Source: Strategy

The preferred stock’s dividend rate is variable, meaning that the yield offered to investors is subject to change on a monthly basis.

Strategy has also opened up voting for its common equity and STRC holders to approve semi-monthly dividend payments.

Magazine: Bitcoin’s ‘biggest bull catalyst’ would be Saylor’s liquidation: Santiment founder

TLDR:

• • Nebius Q1 2026 revenue hit $399M, up 684% year-over-year, with AI revenue representing 98% of total sales.
  • Token Factory offers up to 26x cost savings over frontier APIs, with 99.9% uptime and SOC 2 Type II security.
  • Three Q1 acquisitions — Tavily, Eigen AI, and Clarifai — complete Nebius’s full agentic AI deployment stack.
  • Contracted power capacity surpassed 3.5 gigawatts in Q1, with new guidance targeting 4 gigawatts by year-end.

Nebius recorded $399 million in revenue during Q1 2026, reflecting a 684% year-over-year increase. The company’s AI-specific revenue reached $390 million, growing 841% and representing 98% of total revenue.

Full-year revenue guidance was raised to $3.0–3.4 billion, with ARR guidance set at $7–9 billion. These figures have drawn renewed attention to Nebius’s positioning within the open-source AI infrastructure market.

Token Factory Addresses a Gap in Open-Source AI Deployment

Nebius CEO Roman Chernin outlined during the Q1 2026 earnings call why open-source model deployment remains a persistent challenge.

According to Chernin, proprietary models like those from Anthropic, OpenAI, and Gemini work seamlessly through API calls.

However, deploying open-source alternatives such as DeepSeek, Llama, or Qwen at production scale often fails to meet reliability and cost expectations.

Token Factory is Nebius’s answer to that problem. The platform combines fine-tuning, optimization, orchestration, and deployment into one governed system.

It offers sub-second latency, autoscaling throughput, 99.9% uptime, and SOC 2 Type II security. Early adopters have reported cost reductions of up to 26x compared to frontier proprietary models at equivalent quality.

As Milk Road AI noted on X, Chernin argued that downloading weights from Hugging Face and pairing them with open-source inference engines simply does not work reliably at scale, particularly when economics and uptime are both required. Token Factory was purpose-built to close that gap for enterprise-grade workloads.

Adjusted EBITDA margins in the AI cloud segment nearly doubled quarter-on-quarter, reaching 45%. That combination of triple-digit growth and expanding margins is rare for any company at this stage of development.

Three Acquisitions Expand the Token Factory Stack

During Q1, Nebius completed three strategic acquisitions targeting different layers of its platform. Tavily adds agentic web search and retrieval capabilities to the stack.

Eigen AI, acquired for $643 million, brings advanced model optimization. Clarifai contributes production-grade inference for multimodal and computer vision workloads.

Together, these additions transform Token Factory from an inference platform into a full agentic AI deployment stack.

The pipeline now spans raw model weights through to finished production AI products, all within Nebius’s owned infrastructure. That vertical integration distinguishes the company from GPU rental providers competing on hardware access alone.

On the infrastructure side, contracted power capacity now exceeds 3.5 gigawatts. Nebius hit its full-year power target in Q1 alone and subsequently raised guidance to 4 gigawatts by year-end.

A new 1.2 gigawatt Pennsylvania AI factory brings total owned sites above 100 megawatts to seven across two continents.

That scale of power infrastructure, secured ahead of broader market demand, forms the foundation beneath the Token Factory strategy and positions Nebius within the open-source AI economy for years ahead.

TLDR:

• CFTC Chairman Michael Selig has been the agency’s only commissioner since December, with four seats still vacant.
• House Agriculture leaders argue a full five-member CFTC commission produces more durable and legally sound rules.
• The Senate Banking Committee advanced the CLARITY Act 15-9, expanding CFTC authority over spot digital commodity trading.
• Sen. Klobuchar proposed blocking new CFTC rules from taking effect until at least four commissioners are confirmed and seated.

House Agriculture Committee leaders are pressing President Trump to nominate four CFTC commissioners as crypto legislation advances on Capitol Hill.

Chairman Glenn Thompson and Ranking Member Angie Craig sent a joint letter Friday calling for a full five-member commission.

Their request comes amid a growing regulatory workload and the Senate Banking Committee’s recent advancement of the CLARITY Act with a 15-9 bipartisan vote.

House Leaders Push for Full CFTC Commission Amid Expanding Crypto Mandate

The joint letter from Thompson and Craig pointed directly to CFTC Chairman Michael Selig’s April 16 testimony. Selig outlined an aggressive rulemaking agenda before the committee, covering derivatives markets and digital assets.

However, he has served as the agency’s sole commissioner since December, with four seats remaining empty after a wave of departures.

Thompson and Craig stated in their letter that the public, markets, and the agency itself will be “best served by a full five-member commission,” adding it would deliver “better regulations, more durable rules, and more sensitivity to the divergent views of key derivatives market stakeholders.”

The pair also tied the nomination request to Trump’s budget proposal, which seeks increased CFTC funding. Currently, the agency operates with roughly 543 full-time staff, compared to approximately 4,200 at the SEC.

The letter further noted that filling all seats would complement the administration’s funding request. A bipartisan commission would pair financial resources with balanced leadership.

That combination, the lawmakers argued, would position the CFTC more effectively as the leading derivatives markets regulator globally.

Legal durability also factored into the committee’s argument. Rules established by a sole commissioner may face greater vulnerability in court.

With a string of state-level prediction market suits pending and new rulemakings on the horizon, the letter noted that a full five-member commission can write “more durable rules.” That stronger legal footing would matter as the agency defends its decisions going forward.

CLARITY Act Advances as CFTC Seat Debate Grows

The Senate Banking Committee voted 15-9 on Thursday to advance the CLARITY Act, the crypto market structure bill.

Two Democrats crossed the aisle to support the legislation alongside Republicans. The House had already passed its version of the bill last July with a strong 294-vote majority.

The CLARITY Act would grant the CFTC sweeping new authority over spot digital commodity trading. That expanded mandate would trigger a significant rulemaking process, adding further weight to the call for a fully staffed commission.

Thompson and Craig acknowledged in their letter that the legislation “would require a significant rulemaking process,” reinforcing why more commissioners are needed now.

Bloomberg reported in January that the White House was reviewing a bipartisan slate of potential nominees. Names under consideration included Optiver lobbyist Matt MacKenzie, Jump Trading’s Ari Officer, and Senate Agriculture Committee counsel Nathan Anonick. Trump has not formally nominated anyone beyond Selig.

Meanwhile, Sen. Amy Klobuchar has proposed an amendment to the Senate Agriculture Committee’s version of the bill. Her proposal would block new CFTC rules from taking effect until at least four commissioners are seated.

That move reflects broader Democratic interest in ensuring the agency has adequate leadership before major rulemaking begins.

Strategy, the bitcoin treasury vehicle led by Michael Saylor, disclosed a plan to repurchase $1.5 billion of its 0% senior convertible notes due in 2029. The privately negotiated transactions with a subset of noteholders would retire roughly half of the outstanding 2029 tranche, according to Strategy’s SEC filing. The company cautioned that the final repurchase amount could vary based on market conditions, with settlement slated for the week after the filing’s publication.

The company said it intends to fund the repurchases through a mix of available cash reserves, proceeds from securities sales under its at-the-market (ATM) program, and/or proceeds from the sale of bitcoin. This approach underscores Strategy’s broader effort to reshape its balance sheet while maintaining its bitcoin-centric funding stance.

“Strategy expects to fund the repurchases with available cash reserves, proceeds from sales of securities under its at-the-market offering program, and/or proceeds from the sale of bitcoin.”

Source: Strategy Strategy press release

The move follows comments made by Strategy co-founder Michael Saylor in May 2026, who signaled the possibility of selling a portion of its Bitcoin holdings to fund dividend payments, and earlier notes in February that the company planned to equitize its debt in the coming years. The evolving approach reflects Strategy’s ongoing effort to balance its debt load with its bitcoin-driven financing model.

Related: Strategy’s Bitcoin engine faces $28B STRC ceiling: Delphi Digital

Key takeaways

• The repurchase covers about half of the $2029 convertible note tranche, with an estimated price tag of $1.38 billion and settlement targeted soon after the filing period.
• Funding for the buyback could come from cash reserves, proceeds from Strategy’s ATM program, and/or bitcoin sales, highlighting a flexible approach to debt reduction.
• Strategy intends to equitize its convertible debt over 3–6 years, which would gradually convert creditors into equity holders but may dilute existing shareholders.
• The company’s financing and bitcoin-dominant strategy are supported by a high-liquidity instrument tied to its bitcoin transactions, STRC, which recently posted record activity.
• Strategy’s bitcoin portfolio remains substantial, with recent private-market activity and a focus on using bitcoin as a core funding asset alongside equity-based instruments.

Debt repurchase and the path to equity conversion

Strategy’s 0% senior convertible notes due 2029 have been a central piece of its capital structure. By proposing to repurchase approximately $1.5 billion of these notes—about 50% of the outstanding tranche—the company aims to reduce debt exposure without immediately issuing new equity. The SEC filing notes that the final amount will reflect prevailing market conditions at the time of settlement.

In explaining the financing plan, Strategy highlighted a multi-pronged approach to funding the repurchase. Cash reserves provide a straightforward source, while additional liquidity could come from selling securities under the ATM program or from bitcoin sales. This flexibility suggests the company is prepared to adjust funding sources to align with balance-sheet goals while preserving its strategic bitcoin exposure.

The broader trajectory for Strategy includes a deliberate shift toward equitizing its debt. In 3–6 years, the company intends to convert portions of its convertible debt into equity. If implemented, this would reduce debt obligations but could dilute existing shareholders by expanding the number of outstanding shares. The plan fits into Strategy’s long-running thesis of leveraging bitcoin as a strategic asset to support corporate finance activities, even as it navigates the complexities of debt conversion and equity issuance.

STRC, liquidity, and the bitcoin engine

A cornerstone of Strategy’s financing framework is the Stretch Perpetual Preferred Stock (STRC), the instrument the company has used to fund bitcoin acquisitions in 2026. STRC has drawn considerable investor interest, and its market liquidity surged to new highs in recent sessions. On a single day, STRC trading volume reached about $1.5 billion, marking a record for the equity-like instrument tied to Strategy’s bitcoin strategy.

Delphi Digital has highlighted the potential cap on STRC value, noting discussions around a possible ceiling near $28 billion. This line of analysis provides context for how much liquidity the market may assign to Strategy’s crypto-led financing structure over time, though actual outcomes depend on market dynamics and Strategy’s ongoing operational decisions.

Bitcoin holdings and ongoing funding dynamics

Strategy’s most recent bitcoin acquisition occurred earlier in the week, with the company purchasing 535 BTC for roughly $43 million. That purchase boosted its total bitcoin holdings to 818,869 coins, a stake valued at about $64 billion at prevailing spot prices during publication. The company has described its bitcoin purchases as a core element of its capital strategy, using bitcoin sales, cash reserves, and equity-driven financing to support dividends and other corporate needs.

The 2026 funding approach—primarily via STRC and strategy-driven bitcoin acquisitions—has reinforced Strategy’s position as a unique corporate-finance model within the crypto space. By combining debt management with bitcoin-backed financing, Strategy seeks to maintain liquidity while pursuing growth through its large bitcoin reserve and related financial instruments.

What comes next for Strategy and investors

The immediate focus will be the settlement of the 2029 convertible note repurchase and the exact funding mix that Strategy deploys. Investors will be watching for how the repurchase affects the company’s debt burden, whether the equitization plan proceeds on schedule, and how dilution risks are balanced against the potential for improved balance-sheet stability. Market participants will also be tracking STRC dynamics, including liquidity trends and any regulatory or market-sentiment shifts that could influence Strategy’s ability to deploy bitcoin as a strategic financing tool.

As always, the unfolding interaction between Strategy’s debt strategy, equity issuance plans, and its bitcoin-based funding framework will define its path forward. The next several quarters could clarify whether this hybrid approach delivers greater balance-sheet resilience or introduces new tensions between debt holders and equity owners, particularly if bitcoin prices swing or if funding markets tighten.

Readers should keep an eye on the official Strategy disclosures for settlement specifics, any updates to the equitization timeline, and any statements from executives regarding dividend policy and capital allocation. The evolving narrative around Strategy’s use of STRC and its broader balance-sheet strategy will continue to influence how investors assess the risk and potential of crypto-native corporate finance models.

Source data and ongoing coverage from Strategy’s disclosures will shape the ongoing interpretation of this move, and related market commentary from Delph Digital and other researchers will help contextualize the implications for convertible debt management and bitcoin-backed financing in the sector.

TLDR:

• Amazon, Microsoft, and Google invest billions in AI labs, then collect that money back as locked-in cloud revenue.
  
• Within 16 days, three megadeals handed Anthropic compute from Amazon, Google, and SpaceX simultaneously.
  
• xAI failed to operate independently and was forced to lease its GPU data center directly to rival Anthropic.
  
• Regulators in the US, EU, and UK are now probing whether these compute deals amount to backdoor monopolies.

Major AI labs — OpenAI, Anthropic, and xAI — are often presented as fierce competitors racing to dominate artificial intelligence.

However, a closer look at recent financial deals tells a different story. All three companies rely on the same small group of cloud infrastructure providers: Microsoft, Amazon, and Google.

These tech giants invest billions into AI labs, then collect that money back as cloud revenue. The arrangement is raising serious antitrust concerns around the world.

The Deals That Changed the AI Landscape

Within just 16 days in April and May 2026, three major compute deals reshaped the AI industry. Amazon expanded its Anthropic commitment to $13 billion, tied to $100 billion in AWS cloud spend over ten years.

Google followed with up to $40 billion in equity plus five gigawatts of TPU capacity for Anthropic. Then SpaceX, which had absorbed xAI, handed Anthropic its entire Colossus 1 data center — over 220,000 Nvidia GPUs and 300 megawatts of power.

The financial structure behind these deals follows a repeating pattern. Tech giants invest in AI labs, then require those labs to spend the money back on their own cloud services.

Microsoft’s total OpenAI investment reportedly exceeds $100 billion when Azure infrastructure is counted. In return, OpenAI committed $250 billion in cloud spend back to Azure over a decade.

Amazon also invested $50 billion into OpenAI in February 2026, making it the only hyperscaler holding equity stakes in both Anthropic and OpenAI simultaneously.

As @coinbureau noted, “OpenAI and Anthropic are not rivals, they are financially bound tenants to the same hyperscaler landlords.”

The financial results of this arrangement became clear in Q1 2026. Alphabet reported $37.7 billion in other income, largely from unrealized gains on its Anthropic and SpaceX stakes.

Amazon reported $16.8 billion in non-operating income, also driven by its Anthropic stake. These are paper gains—not cash—and they could reverse if Anthropic’s next funding round prices lower.

When Independence Becomes Too Expensive

xAI’s story offers a cautionary example of operating outside this structure. Grok’s model utilization was reported at around 11%, far below the 40% achieved by competitors.

Unable to sustain infrastructure costs independently, xAI was absorbed by SpaceX, which then leased the Colossus 1 data center directly to Anthropic — the company xAI was built to compete against.

Meta stands apart as the only major frontier AI player operating without cloud dependency. The company is running $125 billion to $145 billion in capital expenditure for 2026, building its own data centers and holding no equity ties to a single cloud partner.

Regulators are now responding to this concentrated structure. The FTC is investigating Amazon and Microsoft’s deals as potential backdoor mergers. The EU is enforcing antitrust rules against exclusive cloud contracts.

The UK has flagged over 90 cross-pollinating partnerships among Big Tech companies. Even if the AI compute stack is broken apart, the same four companies — Microsoft, Amazon, Google, and Meta — are positioned to remain dominant at the foundational layer.

TLDR:

• Only 10 stocks contributed 69% of the S&P 500’s 16% rally, leaving 490 companies largely behind.
• Microsoft, Alphabet, and Amazon pledged a combined $570B+ in AI spending, fueling the tech surge.
• The equal-weight S&P 500 gained just 7–8%, less than half the performance of the standard index.
• Goldman Sachs warned that market breadth has dropped to its narrowest level since the dot-com bubble.

The S&P 500 rally has gained nearly 16% since March 30, but market analysts are raising concerns about how few stocks are driving the move.

Just 10 companies contributed 69% of the entire index gain. The rest of the 490 companies in the index contributed only 31%.

This split between megacap performance and the broader market has drawn comparisons to conditions last seen during the dot-com bubble era.

AI Spending Surge Fuels Semiconductor Melt-Up

The rally began after reports that Iran was open to ending hostilities with the United States. Oil prices fell sharply from above $100, triggering short covering across markets. From there, strong earnings reports from major tech companies took over as the primary driver.

Several of the largest technology firms then raised their capital expenditure forecasts to historic levels. Microsoft projected AI-related spending of around $190 billion.

Alphabet guided toward $180–190 billion, while Amazon held firm at roughly $200 billion. Meta is expected to spend as much as $145 billion on AI infrastructure.

These projections pushed semiconductor stocks into a sharp upward move. Intel rose more than 240% this year. SanDisk surged over 550%. Micron doubled as AI memory demand left customers receiving only 50–67% of the chips they ordered.

As Bull Theory noted on X, “Almost every major tech company raised AI spending projections to levels never seen before,” pointing to the scale of capital flowing into AI infrastructure as the central force behind the current market move.

Narrow Breadth Raises Questions About Rally Durability

Despite the index gains, the equal-weight S&P 500 only rose around 7–8% over the same period. This version of the index removes the outsized influence of megacap stocks. That figure is less than half the performance of the market-cap-weighted index.

Fewer than half of all S&P 500 stocks are currently trading above their 50-day moving average. Goldman Sachs has warned that market breadth has fallen to one of its narrowest levels since the dot-com era. These conditions suggest the broader market is not participating evenly in the recovery.

Alphabet alone contributed 15% of the total index rally. Nvidia added another 10%. Amazon, Broadcom, Intel, Micron, Apple, AMD, and Microsoft carried the bulk of the remaining gains.

The concern among analysts is straightforward. If AI capital spending slows, if the Iran ceasefire breaks down and oil spikes again, or if earnings miss even slightly, there is limited broad market support to cushion the fall.

The rally, as it stands, rests on a narrow foundation of AI-driven stocks and one of the most aggressive corporate spending cycles in recent memory.

Bitcoin treasury company Strategy announced on Friday that it will repurchase $1.5 billion in 0% convertible notes, due in 2029, retiring about half of the 2029 convertible note tranche’s total outstanding debt.

Strategy entered into “privately negotiated transactions” with a portion of its 0% senior convertible note holders on Thursday, agreeing to repurchase the debt for an estimated $1.38 billion, according to the company’s Securities and Exchange Commission (SEC) filing.

The transaction is set to settle on Tuesday of the week following the publication of this article, the company said, adding that the final repurchase amount could “vary” from the estimated amount based on market conditions. The company added:

“Strategy expects to fund the repurchases with available cash reserves, proceeds from sales of securities under its at-the-market offering program, and/or proceeds from the sale of bitcoin.” 

Strategy’s SEC filing documenting the 2029 convertible note repurchase. Source: Strategy

The move follows comments made by Strategy co-founder Michael Saylor in May 2026, signaling that the company could sell a portion of its Bitcoin holdings to fund dividend payments, and earlier comments in February that the company plans to equitize its debt in the coming years.

Related: Strategy’s Bitcoin engine faces $28B STRC ceiling: Delphi Digital

Strategy plans to swap its convertible debt for equity over the next 3-6 years

Strategy plans on equitizing its convertible debt over the next 3-6 years, gradually turning holders of its credit instruments into equity holders.

This would reduce the debt burden on the company, but would also dilute existing stockholder value by adding new equity shares.

Source: Michael Saylor

Strategy has about $8.2 billion in total outstanding debt at the time of publication, according to data from the company, and has funded its BTC buys in 2026 primarily through its Stretch Perpetual Preferred Stock (STRC).

On Thursday, STRC hit $1.5 billion in daily trading volume, setting a new record for the equity instrument, and signaling strong investor interest.

The company’s most recent Bitcoin purchase occurred on Monday, when it bought 535 Bitcoin for $43 million, bringing its total Bitcoin holdings to 818,869 coins, valued at about $64 billion, using BTC’s spot market price at the time of publication.

Magazine: Big Questions: Can Bitcoin save you from the dreaded Cantillon Effect?

TLDR:

• BlackRock is reportedly in discussions to commit between $5 billion and $10 billion to the SpaceX IPO offering.
• SpaceX is targeting June 11 for IPO pricing and June 12 for its market debut on the Nasdaq exchange.
• The offering could raise around $75 billion, valuing SpaceX at approximately $1.75 trillion at listing.
• Morgan Stanley, Bank of America, Citigroup, JPMorgan, and Goldman Sachs are serving as lead bookrunners on the deal.

BlackRock is reportedly in talks to invest up to $10 billion in SpaceX’s anticipated initial public offering. The asset management giant could commit between $5 billion and $10 billion to the offering, according to The Information.

This potential move marks one of the largest institutional bets on Elon Musk’s space and satellite company. SpaceX is targeting a mid-June market debut on the Nasdaq exchange under the ticker “SPCX.”

BlackRock’s Potential Role in the SpaceX IPO

The report from The Information cited people familiar with the discussions. BlackRock has not publicly confirmed its participation in the SpaceX IPO. However, the figures being discussed point to a serious institutional commitment to the deal.

Reuters reported Friday that SpaceX is targeting June 11 for pricing, citing “sources familiar with the matter.” The report also confirmed Nasdaq as the chosen exchange for the listing. That confirmation added further weight to the accelerating timeline surrounding the offering.

Such an investment would place BlackRock among the most prominent backers of the listing. A $10 billion stake in a $1.75 trillion valuation company would be a notable position for any asset manager. The discussions show growing confidence among large institutions in SpaceX’s long-term outlook.

SpaceX plans to publicly release its IPO prospectus as early as next week. A roadshow is expected to begin on June 4, ahead of a possible market debut on June 12. The timeline moved faster than originally planned after the SEC completed its filing review ahead of schedule.

SpaceX IPO Timeline and Market Expectations

SpaceX is aiming to raise around $75 billion through the offering. At that level, it would rank among the largest IPOs in market history. The company’s valuation is expected to reach approximately $1.75 trillion at listing.

The Information noted the potential BlackRock investment could represent “a major institutional bet” on the company.

People familiar with the matter indicated the commitment range sits between $5 billion and $10 billion. No official figures have been confirmed by either BlackRock or SpaceX.

Morgan Stanley, Bank of America, Citigroup, JPMorgan, and Goldman Sachs are serving as lead bookrunners. These banks bring strong distribution networks that could support demand across institutional investors. Their involvement adds credibility to the scale of the transaction.

Nasdaq’s recently introduced fast-entry rules for large-cap listings may benefit SpaceX after it begins trading. Those rules could allow SpaceX to gain quicker inclusion in the Nasdaq-100 index.

As Reuters noted, the accelerated pace was “partly driven by a quicker-than-anticipated review” of SpaceX’s IPO filings by the SEC. Market watchers are now tracking every development as the June dates draw closer.