A stablecoin promises to maintain a fixed value of $1, but STRC never made that promise. It’s a preferred stock, a class of stock that pays a fixed dividend, designed to trade near $100 but without any peg to defend, so it can’t “unstick” like UST did.
“The goal of the strategy has been to support STRC’s operations at a level close to $100, not guarantee it,” Palmer said. “In our view, what happened with STRC is best described not as an unbundling (something that was never tied cannot be untied) but as a market-driven reset of required performance.”
UST was algorithmic and maintained its dollar value through a mint and burn cycle with a sister token, LUNA, and no hard reserves behind it. When trust was broken, the circle fell apart and both fell to almost zero.
STRC has no such self-reinforcing mechanism. It is indirectly backed by Strategy’s bitcoin, which the company said Monday now totals 847,363 coins worth about $54.5 billion.
However, the drop does affect Strategy’s purchasing engine. When STRC trades at $100 or more, the company issues new shares and uses the cash to buy more bitcoins.
Below that level, the channel stops working, which explains why Strategy has paused it.
