In a recent discussion, Strive CEO Matt Cole highlighted the potential of Bitcoin-backed “digital credit” as a transitional tool from traditional fiat currencies to a Bitcoin-centric economy. During his appearance on the Pomp Podcast hosted by Anthony Pompliano, Cole elaborated on Strive’s SATA product—a type of Variable Rate Series A Perpetual Preferred Stock that offers a 13% variable dividend. This financial instrument aims to provide investors with exposure to Bitcoin while mitigating volatility.
Cole emphasized that Strive operates with a debt-free balance sheet and maintains an 18-month dividend reserve, allowing the company to sustain its payouts even during severe market downturns like the bear market of 2022-23 without liquidating its Bitcoin holdings. He noted that Strive currently holds approximately 19,000 BTC, valued around $1.2 billion.
In comparison to other offerings in the market, Cole mentioned that Strive’s SATA product outperforms Strategy’s comparable preferred-security offering, which has an approximate yield of 11.5%. He framed SATA as a long-term investment, projecting that Bitcoin could appreciate at roughly 30% annually over the coming decades. Under this assumption, holders of the preferred shares would need to achieve only around a 6.5% effective return to sustain dividend payments indefinitely.
Despite Cole’s optimistic outlook, Strive’s stock experienced a decline of over 7% on Friday. Sentiment on Stocktwits suggested a bearish outlook for the stock, with low levels of discussion surrounding it. Similarly, Bitcoin’s price was reported to be down 2% at $60,883, experiencing a more significant drop of over 17% in the past week, with Stocktwits data indicating an extremely bearish sentiment among retail investors.
Cole also addressed concerns regarding the recent sale of 32 Bitcoin by another firm, arguing that such moves should be viewed as disciplined capital management rather than an indication of dwindling confidence in Bitcoin. He reassured that institutions like Strategy are inclined to remain net buyers of Bitcoin, predicting that institutional adoption of Bitcoin exchange-traded funds (ETFs) and digital credit products is still in its infancy. Cole noted that it often takes several years for ETFs to gain widespread acceptance across wealth management platforms, indicating a slow but steady progression toward broader adoption.
The crypto market continues to evolve, and with new financial products like the SATA, companies like Strive are attempting to innovate in ways that can provide more stability and income potential for investors.
