Potential liquidity contractions in secondary markets and surging government bond yields could spell trouble for preferred perpetual stockholders. Investors are mispricing risk for perpetual preferred stocks, like Bitcoin treasury company Strategy’s Variable Rate Series A Perpetual Stretch Preferred Stock (STRC), according to Matt Dines, the chief investment officer of credit asset management company Build Markets. The corporate issuers of perpetual preferred stocks never have to repay holders their principal investment, and can just pay dividends indefinitely, without renegotiating the investment terms, Dines told the Truth for the Commoner (TFTC) media outlet. If holders want to cash out, they must sell the perpetuals on the secondary market to recover their principal, which leaves holders exposed to liquidity contraction and interest rate risks that exist forever because perpetuals lack a maturity date, he said. He added: Basic performance metrics for Strategy's STRC perpetual preferred stock. Source: Sayl...
The notes carry a 0% coupon, but can be converted into equity in the company if holders choose to redeem their notes for shares. Bitcoin treasury company Strategy announced on Friday that it will repurchase $1.5 billion in 0% convertible notes, due in 2029, retiring about half of the 2029 convertible note tranche’s total outstanding debt. Strategy entered into “privately negotiated transactions” with a portion of its 0% senior convertible note holders on Thursday, agreeing to repurchase the debt for an estimated $1.38 billion, according to the company’s Securities and Exchange Commission (SEC) filing. The transaction is set to settle on Tuesday of the week following the publication of this article, the company said, adding that the final repurchase amount could “vary” from the estimated amount based on market conditions. The company added: Read more
Bitcoin fell below $78,000 for the first time since the start of May, but traders refused to give up hope of a BTC price rebound coming next. Bitcoin (BTC) circled $78,000 on Saturday after geopolitical headwinds erased most of its May gains. Key points: Read more
In a world-first deal, OpenAI and Malta will give all citizens free ChatGPT Plus for a year after they complete a government-backed AI literacy course. OpenAI and the Maltese government have announced a world-first partnership to roll out ChatGPT Plus to all Maltese citizens, marking the first time a government has struck such a deal with the AI company. Under the programme, citizens who complete a government-backed AI literacy course will receive free access to ChatGPT Plus for one year, OpenAI announced on Saturday. The course, developed by the University of Malta, covers what AI is, what it can and cannot do and how to use it responsibly at home and in the workplace. “Malta is the first country to launch a partnership of this scale because we refuse to let our citizens stay behind in the digital age,” Maltese minister for economy, enterprise and strategic projects Silvio Schembri said, adding that the goal is to turn AI “from an unfamiliar concept into practical assistance for our families, students, and w...