Strategy (MSTR) launched its first non-US perpetual preferred product, Stream (STRE), in November, aiming to tap demand in the European Economic Area (EEA).
However, it didn’t turn out the way Michael Saylor’s company had planned.
The preferred stock was issued with a declared value of EUR100 ($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-yielding money market-style preferred stock. Strategy ultimately raised $715 million, pricing the instrument at a 20% discount to 80 euros per share due to market conditions and demand.
Although, in theory, the financial product seemed good, since its issuance, the STRE has however 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, pointed to several structural reasons why STRE may not have taken off, despite Europe being a large enough addressable market.
First, STRE is difficult to access, according to Oei. The product is listed on Luxembourg’s Euro MTF, a site that lacks user-friendly distribution. Interactive Brokers, one of the world’s largest brokerage platforms, does not offer STRE, and many other retail-focused platforms also do not support trading this instrument.
Then there is the lack of transparent historical prices and reliable market data. Limited visibility on platforms like TradingView hinders adoption as investors struggle to assess liquidity and performance. Currently, TradingView shows a market cap of $39 billion for STRE along with a trading volume of just 1.3k.
The future?
What will happen to the STRE, given the challenges it faces?
Oei suggests that STRE be re-listed on alternative sites.
The Dutch financial and trading infrastructure, for example, offers stronger distribution, deeper market making, tighter bid-ask spreads and greater retail accessibility. These conditions are likely more conducive to large-scale adoption of the financial product.
Although Executive Chairman Michael Saylor has previously downplayed expansion in markets such as Japan, it remains an open question whether Strategy will double down on Europe as a growth opportunity, or whether it will continue to focus primarily on the U.S. market, where it offers four perpetual preferred stock products.
