Options traders are increasingly betting against Michael Saylor, the outspoken proponent of cryptocurrency and CEO of Strategy. This shift in sentiment comes as traders display bearish tendencies toward the company’s stock—MSTR—and its variable-rate preferred stock, STRC.
Last week, trading in puts surged, with more than twice as many puts transacted compared to calls on Friday alone. The volume of put options significantly outstripped call options, coming in at almost three times the daily average for the previous month. Out of a total of $335 million in premium traded, $250 million was linked to bearish puts.
Notably, much of this put activity is associated with yield strategies employed in the YieldMax Short MSTR Option Strategy ETF (WNTR), which hedges against potential declines in Strategy stock while generating income through put spreads. Since May 11, WNTR shares have surged by 30%, contrasting sharply with the declining performance of Strategy stock.
In addition, STRC—characterized by Saylor as “digital credit” and marketed as an alternative to traditional money market funds—has also struggled, seeing a 3.6% drop to $92 per share, the lowest price since November last year. Market analysts are now increasingly aware of what they describe as a “higher Michael Saylor risk factor,” particularly following his inconsistent strategies regarding Bitcoin and cash management. David Dziekanski, CEO of Quantify Funds, indicated that Saylor’s previous assertions about STRC’s stability have diminished due to his recent decisions to sell Bitcoin and redirect cash towards bond buybacks.
The trading environment is compounded by external economic factors, including a selloff in Treasury bonds and rising yields, which have contributed to a rise in interest rate hike probabilities above 40%. This backdrop is daunting for cryptocurrencies, which historically suffer during periods of rising interest rates, particularly affecting credit instruments like STRC.
Amid these tumultuous developments, Bitcoin itself has dipped below $60,000, marking its first decline beneath that threshold since late 2024. As traders navigate this market turbulence, sentiment around Saylor and his strategies continues to evolve, indicating a significant shift in investment attitudes.
