Strategy CEO Phong Le said the company underestimated how much borrowed money would flow into STRC, its $9.3 billion preferred stock designed to trade near a $100 face value. STRC pays a 12% annual dividend but fell to about $75 in late June, or roughly a quarter below par, before recovering to $99. Le said investors borrowed against Bitcoin at about 6% to capture STRC's higher yield, then faced pressure to add collateral or sell when Bitcoin declined. That margin-driven selling accelerated STRC's drop. Strategy began repurchasing STRC in late July after earlier dividend increases failed to support the price. Le said buybacks reduce future dividend obligations without draining cash through a higher payout, though they are funded through MSTR common-stock sales and potentially Bitcoin. Strategy's dollar reserve holds about $5.1 billion, enough for roughly three years of dividends, and is restricted to preferred dividends and interest on convertible debt. Le said institutions now own about 30% of STRC, compared with 20% previously, and expects the stock to recover fully as long-term holders replace leveraged traders. STRC's next dividend is payable October 15 to holders of record on September 30.