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Crypto World

Strategy Turns to Costly Dividends to Keep Buying Bitcoin

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Strategy's Bitcoin Purchases from STRC.

MicroStrategy, an enterprise software firm turned Bitcoin treasury powerhouse, signaled its intention Sunday to deepen its bet on the flagship digital asset.

This move comes as the company’s massive $55 billion hoard hovers just above its average purchase price.

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Strategy Hikes STRC Dividend to 11.25% to Fuel Bitcoin Spree

In a post on the social media platform X, Executive Chairman Michael Saylor shared a graphic captioned “More Orange.” Over the past months, the billionaire has long used similar phrases to hint at upcoming BTC acquisitions.

Notably, the company recently marked a milestone of 2,000 days since adopting its “Bitcoin Standard.”

Meanwhile, this potential acquisition comes as the firm’s balance sheet faces its most significant test in months.

Strategy’s current holdings of 712,647 BTC were acquired at an average cost of $76,037 per coin. With BTC trading at approximately $78,000 on Sunday—a sharp retracement from the six-figure highs seen last autumn—the firm’s unrealized gains have narrowed to less than 3%.

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To fund the next phase of its purchases, Strategy moved to attract fresh capital by hiking the dividend on its Series A Perpetual Stretch Preferred Stock (STRC) by 25 basis points. This adjustment brings the yield to 11.25% for February 2026.

The 11.25% payout represents a major premium over typical corporate bonds, reflecting both the company’s hunger for capital and the inherent volatility of its bitcoin-centric model.

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Notably, STRC is a variable-rate security that is part of a “fixed-income” suite that includes products like Strike, Stride, and Strife, has become the primary engine for the firm’s capital raises.

Data shows that STRC sales alone have funded the acquisition of over 27,000 BTC since the product’s November debut.

Strategy's Bitcoin Purchases from STRC.
Strategy’s Bitcoin Purchases from STRC. Source:STRC.live

However, critics warn that the high cost of servicing these dividends could create a significant cash-flow squeeze. This risk is particularly acute if the BTC’s price remains stagnant or dips below the firm’s $76,000 waterline.

For now, Strategy appears undeterred. The firm still has billions in available capacity under its at-the-market offerings, and Saylor’s latest signal suggests that for Strategy, the only response to market volatility is to buy more.

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Crypto World

CFTC Staff Share FAQ on Crypto Collateral

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CFTC Staff Share FAQ on Crypto Collateral

The US Commodity Futures Trading Commission has given more details on its expectations for the use of crypto as collateral amid a pilot program that the agency launched last year.

In a notice on Friday, the CFTC’s Market Participants Division and Division of Clearing and Risk responded to frequently asked questions that emerged from two staff letters issued in December that established a pilot allowing crypto to be used as collateral in derivatives markets.

The notice reminded futures commission merchants wanting to take part in the pilot that they must file a notice with the Market Participants Division “which includes the date on which it will commence accepting crypto assets from customers as margin collateral.”

The crypto industry has argued that crypto technology is best suited for 24-7 trading and instant settlement, and the CFTC’s guidance in December clarified what tokenized assets can be used as collateral, along with how to value them and calculate how much is needed for a trading position.

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CFTC aligns guidance with SEC

The CFTC made clear its guidance was to align with the Securities and Exchange Commission, as the two agencies work together on a regulatory framework for crypto.

The CFTC said that capital charges, the amount that must be held to cover losses, would be “consistent with the SEC” and that futures commission merchants should apply a 20% capital charge for positions in Bitcoin (BTC) and Ether (ETH), while stablecoins should get a 2% charge.

Source: Mike Selig

The notice added that futures commission merchants taking part in the pilot can only accept Bitcoin, Ether, or stablecoins for the first three months and must give prompt notice of any significant cybersecurity or system issues. They must also file weekly reports of the total crypto held across customer account types.

After the three-month period, other cryptocurrencies can be accepted as collateral and the reporting requirements will end.

Related: SEC interpretation on crypto laws ‘a beginning, not an end,’ says Atkins

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The notice also clarified that “only proprietary payment stablecoins may be deposited as residual interest in customer segregated accounts” and that futures commission merchants can’t accept other cryptocurrencies for that purpose.

The CFTC said that crypto and stablecoins cannot be used for collateral of uncleared swaps, but swap dealers can use tokenized versions of an eligible asset if it meets regulatory requirements and grants the holder the same rights in its traditional form.

Meanwhile, derivatives clearing organizations can accept crypto and stablecoins as initial margin for cleared transactions if they meet CFTC requirements regarding minimal credit, market, and liquidity risks.

Magazine: How crypto laws changed in 2025 — and how they’ll change in 2026

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