Bitcoin dipped below $80,000 this week, but one analyst expects the decline to be brief—pointing to a structural buying mechanism tied to Strategy’s preferred stock that has fueled mid-month rallies for three consecutive months.
The leading crypto is trading at around $79,680, down 0.5% over the past 24 hours according to CoinGecko data, after hitting an intraday low of $78,795
The drop comes as U.S. spot Bitcoin ETFs posted $630.4 million in net outflows on May 13, the largest daily exit in three months. “This dip will be short-lived,” Andri Fauzan Adziima, research lead at Bitrue Research Institute, told Decrypt. “We’ve seen a classic liquidity sweep of recent lows around $78,000–$79,000, followed by a solid defense of the monthly 50MA and a quick reclaim above $80,000. On-chain flows show large wallets continuing to accumulate aggressively.” However, there’s another factor working behind the scenes—Bitcoin treasury firm Strategy’s preferred shares STRC, pronounced Stretch. The STRC mechanism Strategy’s STRC has fueled mid-month rallies for three consecutive months, according to a Tuesday report from K33 Research.
The Bitcoin treasury company has ramped up its Bitcoin purchases through this instrument from 4,467 BTC in January to 22,131 BTC in March and nearly 46,872 BTC in April. This Friday marks another STRC ex-dividend date, which could spark another mid-month rally soon, according to Vetle Lund, the firm’s head of research. The mechanism works like this: STRC pays dividends on the last day of each month, with ownership determined by the ex-dividend date on the 15th.