STRC- the new Bitconnect in 2026?

There is no need to question the intellect of MicroStrategy CEO or so-called Strategy Inc. as of late, but let me break down why sometimes a genius can stretch himself too thin on a plate, trying to bite too much at once, or just getting complacent because things were working out just fine for so long.

This article has nothing personal to do with the CEO of MSTR or STRC (Saylor is not technically the CEO of STRC, but for practical purposes, let’s say he is). I have no grudge against him. As someone who has been following the crypto space for many years, since 2011, there are not many as insightful characters out there as M.Saylor himself when it comes to crypto knowledge.

I just want to get this out there, before anyone starts making conclusions about why all of a sudden this bearish bias on one of his companies. The reasons are primarily technical (macro), but to some extent, personal as well. I do not trust almost anyone in the crypto space as it is filled to the neck of the glass with shady characters, and that includes even the “big dogs”. We have seen SBF, guys from Bitconnect, MtGox Karpeles, and other figures deploying silent bombs that went off, taking their coin-holders with them. And there certainly is a rather shady promotional aspect coming from Saylor’s side on social media, just about the messages portrayed from someone who clearly has more than just a few brain cells under the hood is very strange. I firmly believe in the concept of Manjurian candidates, and you can often never tell if one is so, until years later.

Those kinds of tweets with deceptive “easy lifestyle” messages that connect to investing or trading (a very difficult profession) always raise red flags. But enough about Saylor himself. Let’s move towards STRC.

In case you are unfamiliar, in currency markets or even equities to some extent, there is this thing called a “peg”. Its mechanism is where, for example, a central bank pegs / binds its currency to another nations currency, in order to maintain stable pricing across the year, as much as possible for imports and exports.

This is why many emerging nations peg (or try to) their currencies to the US dollar, so that they have more stable national currencies, they maintain the exports in stable pricing (which importers like), and it also reduces national inflation (sometimes).

An example of a currency peg between two countries would be Hong Kong and the USA via the USDHKD forex pair. In the image below, USDHKD and peg level are highlighted, which can be noticeable via price-bind, where price spends a lot of time not going anywhere. The central bank maintains that level artificially via managing of buying/selling in spot markets or their reserves.

A similar concept exists in crypto markets as well. Certain cryptocurrencies are pegged with Bitcoin, USDC, or USDT at certain ratios. Most of those provide a certain yield rate. Because there are not many use cases in pegging crypto one to another and loosing the volatility aspect of making gains via volatility (against fiat currency), but if there is a provided yield, then that can become attractive to investors.

For example, a small altcoin binds / pegs its price to larger market cap crypto such as USDC or Bitcoin, which provides certain price stability (or more stability than an altcoin would typically have), and as return investors get a certain % yield back. Sounds good, right? You decrease volatility, and you get a yield return. Well…there is a curve ball to this coming (in fine print).

Most of those pegs need to be maintained via increasing reserves or fresh investments. Which, in a way, is a Ponzi scheme. For example. A country’s central bank maintains a currency peg by continuously having its population productive, creating excess capital and excess resources, which are sold abroad or consumed nationally, and therefore using excess capital to finance the cushion needed to maintain the currency peg to the US dollar. This is the essence of petro-dollar system built in 1970s as well and explains why many oil exporting nations have pegged their currencies to USD.

So what happens when excess capital starts to decline, because the country is losing access to trade markets (tariffs) or there is an energy crisis preventing enough fuel from being deployed, so the economy stalls? The central bank is no longer able to defend the peg if such conditions remain present for a prolonged time. And peg breaks. And once it does…if it’s a hard peg, overnight a massive currency depreciation happens.

Now that the same concept of reserves (and Ponzi scheme) works for cryptocurrencies (and STRC in this case) as well. Because cryptocurrencies are not like national economies, there is nothing (as) productive created; what they need is a constant capital influx. More and more new buyers that are coming on top of prior buyers. Enroning it. Bitcoin’s price needs to keep going higher, and more capital has to fly into those pegged altcoins that pay high yields monthly or yearly.

We had a few of those companies / cryptocurrencies over the past several years, with such schemes that eventually collapsed spectacularly. Two of the probably most well-known are Luna and Bitconnect. Once the trend in crypto turned south and sustained pressure downwards, the Ponzi scheme stopped working. Capital started flying out instead of in. Prior buyers became sellers, and companies were unable to pay further withdrawal requests, leading to a spiral in the price of those currencies and crashing swiftly within a single day to 0. Lossing 99% of value in a snap. That’s how peg failures work, especially hard pegs. There are soft pegs and hard pegs. Now, while STRC is technically a soft peg, there are certain factors going for it that make it questionable. While Luna and Bitconnect were not technically “pegs”, their mechanism did function similarly, requiring consistent capital inflows, and while the price was not pegged (had wide range) it actually was pegged to similar extent of how Enron was to their inflows/outflows using mid point as “peg”.

So why my bearish view on STRC all of a sudden? If you follow me on social media, you haven’t seen me post bearish calls on it in any prior months for good reason, because we were until January 2026 in strong risk-ON market.

With February we entered into risk-OFF regime and I believe we are about to face a generational crisis event, coming out of the global energy crisis, which will devalue a lot of risk assets. Stocks and crypto, as the most speculative, hold first place for that.

If the energy crisis starts to decrease revenues, cash balances, and the prosperity of people and businesses (which I believe is likely), then many will become forced sellers of crypto or equities. Which means, you might own a Bitcoin or some gamble-alt-coins, and you would never think of selling them in a bear market, but things turn south financially, and you just might be forced to. That kind of behavior on a global basis can put significant pressure on crypto markets, creating further declines, even after we have seen a haircut from top to current price of over 50%. I believe that this energy crisis has the potential to drive Bitcoin much lower from here. It is important that I outline this, as this is absolutely the core of why I think STRC might be in trouble.

To keep things short:

STRC is a competitive asset to the US Treasury (TLT), since both STRC and TLT trade as equity instruments. They are both yield-providing instruments, both backed by some larger-cap (higher-trust) assets. US Treasury backed by the US government and Pentagon, and STRC is backed by Bitcoin and kinda MSTR and its creativity of Saylor as well.

The US Treasury provides a certain yield. STRC is trying to compete with it by providing you with more yield (11% aprox currently). Both the US T-bill and STRC have flexible yields, not fixed. They respond via market dynamics, or more specifically, inflation/deflation and GDP declines. The lower the bonds go or the lower the Bitcoin goes, the higher the yields go on each US T-bill (TLT) and STRC.
So the higher the bond yields go, the more US government is spending on borrowing costs, and the higher the STRC yield goes the more company is spending on dividend payouts. Similar concept.

The price of STRC stock is more or less pegged to 100. Meaning, an investor or trader is not supposed to make any gains by trying to trade volatility. The value of ticker/company/stock comes, or at least is expected to come, from the yield itself. You get 10% annual return on the yield itself. Aka dividend. Obviously their pegged model is a bit unusal in the equity space, as most stocks will freely move on day to day basis including those paying good dividends (ZIM?), but STRC is more or less pegged. Technically. Practically…not really. No peg lasts for ever.

So where are the weak spots of STRC?:

Historically, every extended crypto bear market (lasting over a year) has led to the collapse or liquidation of at least one major company or coin (the one that nobody expected to), especially those tied to pegged cryptocurrencies and ponzi schemes. Based on current trends, I believe we are entering another prolonged bear market, and STRC appears vulnerable in this context.

1.STRC aims to compete with established assets like TLT. While this may work in a bull market, in a bear market, it is challenging for a smaller competitor to go against a dominant player. Investors tend to overlook warning signs in bull markets, but in bear markets, especially institutional investors, scrutinize red flags. Therefore, I expect capital to shift from STRC to TLT in the coming months.

2.If interest rates rise over the next year (which I think they will), that is negative for ANY yielding instrument. No matter what it is. But especially a pegged one. Because as interest rates rise more, the bond yields go higher. As STRC is competing with bonds, the % yield on STRC needs to lift as well. This creates more pressure on the company to access more reserves of Bitcoin to sustain the model or to attract more investors.

Basically the pressure on ponzi scheme increases as interest rates globally go higher. And believe me…this energy crisis will lift global interest rates quite some (before demand destruction sends them lower again maybe a year later). The higher the rates go, the more STRC needs to hike its yield. The market will soon be asking, “hey so are you loading up with extra Bitcoins via STRC / MSTR to make up for yield dividends?”

3.MSTR’s model is dilution-based. The higher the interest rates go, the lower the Bitcoin price goes (always in the past), the lower the MSTR goes, because SPY goes lower when central banks start to hike rates. But since MSTR’s model is dilution-based, you have declining SPY, declining MSTR, and on top of that, dilution needs to be raised (issuing more shares), which fuels even more downside pressure on MSTR stock, and that is all plugged into the STRC model itself. The dilution model is not an issue in a strong bull market, where volume swallows up the extra shares. But in a bear market… that’s a different story.

I just want to clarify the phrase “ponzi scheme” used for STRC/MSTR context…Its tricky to explain. Technically within strong bull market, there is nothing wrong with their business model, as constant capital inflows and fresh buyers mask up the “business model” as it is. It really becomes a ponzi scheme with fragile spot when company starts to struggle attracting enough fresh buyers in bear market specifically, or especially prolonged one that titls the entire scheme closer to bad outcomes of ponzi scheme potentially. I believe every single financial asset needs to always be looked and judged from cyclical perspective. Nothing is the same across the decade. Global conditions change every so often, and so should our harshness of judgment.

If we take for granted that we have an energy crisis on our hands, which by its minimum (most optimistic) scenario lasts for several months, then the interest rates will go up somewhat, and bonds will lose value, with bond yields going higher (making borrowing more expensive). 4 Bearish variable stack.

Central banks already are (BOJ, BOA) raising rates, and more will follow. Now, a short-term energy crisis where the US and Iran make a peace deal by May, and everything sorts itself out, would not be that problematic for STRC. It becomes a high probability projection from my view, if we have no peace, and the conflict just keeps going with no end in sight, well past May or June. At that point, the negative pressures on STRC start to mount, and most of what I have written in this article is for that scenario, prolonged conflict. Please keep in mind.

So an energy crisis pushes bond prices down and bond yields up, because investors expect that global economic growth will decline. Logical. At the same time, high oil prices create inflation, which causes central banks to hike rates. This, in turn, pushes bond prices even lower and bond yields even higher as they shadow the CB interest rates.

I believe that in front of us, we have significant declines in bond prices coming over the next few months, with bond yields going far past 2022 and then some for all global central banks, Japan currently leading the pack (on image above).

If that is the case…where does Bitcoin go? Lower. Bitcoin is a deflationary asset. So if Bitcoin’s price plummeted more from the current 65k, and the MSTR stock plummeted more, more dilution is issued over time, and at some point, the yield on STRC could reach so high…that investors would start to seriously question if STRC is able to pay them out.

Because think of it this way: If broad equity markets go into a heavier bear market, there won’t be more fresh buyers of STRC or MSTR at large numbers. The yield sustainability model of STRC can be questioned in deep equity+crypto bear market. And that is precisely how every pegged currency or equity asset had a de-peg following a significant decline or just straight up liquidation. The question is just at what price level of Bitcoin would investors start to panic? 50k? 45k? 40k?

In my view, it is possible that we see STRC stock decline from 100 down to 50, or even 20, at some point later this year (Bitcoin needs to go 50k or under first). Or there is a scenario under which STRC goes to 0 just like Luna, but that requires a significant crash in Bitcoin’s price, perhaps 30k or slightly under. All of those scenarios are really driven by outcomes of MidEast conflict.

Whether the price of STRC bounces back i do not know (after decline), but i would dare to bet that we will see at least a few of major slumps in price that were not supposed to happen and go way beyond just 10%. Remember that the ticker’s price is meant to be pegged to 100 more or less (with some 5% flexible room). Could that make it a good short? Possibly but there are some drawbacks:

-High swing borrowing fees,

-Unable to short it via CFD for easy carry,

-Its not the cheapest instrument, so a certain amount of buying power would be locked for a while.

-The timing is very difficult to define, could be 2 months, could be 4. Could be a bit more.

But one thing i am certain about, i would not want to be an investor or buyer of STRC at any point over the next 2 years. Regardless if their yield goes much higher from current 11%.

Why is this potentially a short trade with realtively good RR? Because the ticker is pegged around 100 in a bear market. It’s not really likely that it overshoots that 100 by much. But the downside is wide open. Could they (market makers) technically spike it above 100 significantly to wipe out shorts before tanking it? Yes, that is a possibility. I have seen that on several pegged assets. That is the only risk that a short seller on stock would carry: a counter-targeted short squeeze, but if there was such move to happen…that would be the biggest confirmation of upcoming decline at least in my view.