Michael Saylor Links Bitcoin Digital Credit to 400 Years of Financial History

TLDR:

• Michael Saylor says Strategy’s Bitcoin digital credit model draws on over four centuries of financial history.
• Strategy raised $2.521 billion through its STRC offering in July 2025 and used the proceeds to buy 21,021 BTC.
• Strategy’s STRC shares now use daily dividend record dates, and cash payments follow on the next business day.
• Saylor also said Strategy could create up to $30 billion in digital credit without issuing more common shares.

Strategy Executive Chairman Michael Saylor has explained how financial systems developed over four centuries made today’s digital credit products possible. His November 7 essay follows the company’s STRC daily dividend changes, which took effect earlier this month.

Saylor described Bitcoin as the reserve asset behind Strategy’s financing model, while preferred shares provide investors with recurring cash payments. He argued that this arrangement depends on older financial structures rather than Bitcoin alone.

Michael Saylor Explains the Origins of Digital Credit

Saylor traced the foundations of digital credit to 1602, when the Dutch East India Company introduced transferable corporate ownership. Investors could sell their shares without withdrawing capital from the business, allowing companies to finance long-term operations.

That structure later expanded through preferred stock, which offered investors different rights to dividends and company assets. Saylor cited an 1836 Baltimore & Ohio Railroad financing that gave preferred investors priority over common shareholders.

As financial markets developed, exchanges made those securities easier to trade, while new regulations established rules for issuing them. By the 1980s, companies could also use shelf registrations to prepare offerings before they needed additional capital.

Bitcoin entered this established system in 2008, giving companies another asset to hold on their balance sheets. Strategy now combines those holdings with preferred securities, allowing investors to earn cash distributions without directly owning Bitcoin.

The company demonstrated that approach when it launched Stretch, or STRC, in July 2025. Its offering raised approximately $2.521 billion before expenses, and Strategy used the proceeds to purchase 21,021 Bitcoin.

The same financing structure continues to support its treasury strategy. In October, Strategy purchased 334 Bitcoin using $15.7 million from common-stock sales and $13 million in existing cash.

STRC Dividend Changes Bring Digital Credit Into Focus

The preferred-stock structure allows Strategy to raise capital while offering investors a different form of exposure to its Bitcoin treasury. Under the security’s terms, STRC shareholders receive dividends rather than income generated directly by Bitcoin. Strategy recently approved a new payment schedule to make those distributions more frequent.

The STRC dividend policy now uses daily record dates, with payments made on the next business day. The company maintained STRC’s annualized dividend rate at 12% for November, aiming to support trading near its $100 stated value. However, making regular payments requires sufficient cash, since Bitcoin does not generate dividend income.

Strategy addressed those obligations by building a $4.83 billion reserve alongside $242.4 million in additional cash. Its October 29 earnings report placed combined dollar assets at $5.07 billion, covering approximately 3.4 years of dividend and interest obligations.

The company also used cash to manage its preferred shares when they traded below their stated value. During the week ending October 25, Strategy spent $204.9 million on STRC preferred-stock buybacks while making no new Bitcoin purchases. Those repurchases helped bring cumulative STRC buyback spending to approximately $2.04 billion.

Meanwhile, Strategy’s Bitcoin holdings remained at 848,517 BTC. Saylor later discussed expanding this model during the company’s third-quarter earnings call. He estimated that Strategy could potentially create $10 billion, $20 billion, or $30 billion through digital credit financing.

That amount represents potential financing capacity rather than an announced capital raise. Strategy also plans to extend daily dividend schedules to STRF, STRK, and STRD beginning January 1, 2027, with initial payments scheduled for January 4.

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