Strategy (MSTR) introduced its first perpetual preferred product outside the United States, Stream (STRE), in November, aiming to tap into demand across the European Economic Area (EEA).
However, it did not turn out as Michael Saylor’s company intended.
The preferred stock was issued with a stated value of €100 ($115) per share, pays an annual dividend of 10% and sits above common equity in the capital structure. STRE was positioned as a European analogue of Stretch (STRC), the company’s high-yield money market-style preferred stock. The strategy ultimately raised $715 million, valuing the instrument at a 20% discount to €80 per share due to market conditions and demand.
While the financial product sounded good in theory, since its issuance, STRE has struggled to gain traction. There has also been little public communication from the company about the product and it has since been removed from the company’s dashboard.
So what happened?
Khing Oei, founder and CEO of Treasury, a Netherlands-based bitcoin treasury company, has pointed out several structural reasons why STRE may not have taken off, even though Europe is a large enough addressable market.
First of all, according to the Oei, STRE is difficult to access. The product is listed on the Luxembourg Euro MTF, a location that lacks a user-friendly distribution. Interactive Brokers, one of the largest brokerage platforms in the world, does not offer STRE, and many other retail-focused platforms also do not support trading of the instrument.
Then there is the lack of transparent historical prices and reliable market data. Limited visibility across platforms like TradingView hinders adoption as investors struggle to assess liquidity and performance. Currently, TradingView shows a market cap of $39B for STRE along with a trading volume of just 1.3K.
The future?
What will happen to STRE, given the problems it faces?
The Oei suggests that STRE should relist in alternative venues.
The Dutch financial and trading infrastructure, for example, offers stronger distribution, deeper market making, tighter bid-ask spreads and broader retail accessibility. These conditions are likely to be more conducive to expanding adoption of the financial product.
While Chief Executive Michael Saylor has downplayed expansion into markets such as Japan, it remains an open question whether Strategy will double down on Europe as a growth opportunity or instead continue to focus primarily on the U.S. market, where it has four perpetual preferred stock products.
