Legal gavel hangs over Strategy: Rosen Law Firm launches investigation into Michael Saylor's company
The Rosen Law Firm has officially announced the launch of an investigation into Strategy (formerly MicroStrategy) and invites investors who purchased the company's securities to join a potential class action lawsuit. This event has already sparked a strong reaction in the market, and as an analyst, I see several important aspects here that need to be examined.
The Essence of the Claims: Misleading or Standard Practice?
Lawyers are checking whether Strategy and its management published misleading statements about its operations, bitcoin storage strategy, business profitability, and risks associated with the aggressive BTC accumulation model. The investigation covers a range of securities: MSTR, STRF, STRC, STRK, and STRD. Particular attention is focused on STRC — Strategy's perpetual preferred stock.
It is important to emphasize that the Rosen Law Firm has not yet filed any charges. The investigation was initiated amid sharp volatility in instruments linked to Strategy and growing concerns about the sustainability of its capital structure, which increasingly relies on various types of securities to finance bitcoin purchases.
Parallels with Terra and Arkham's Position: Is STRC the New LUNA?
Against the backdrop of STRC falling below par, parallels are being actively drawn online with the collapse of the Terra ecosystem. However, the Arkham platform has strongly opposed this comparison. Its experts rightly note a fundamental difference: Strategy has no legal obligation to support the market price of STRC, unlike the algorithmic stabilization mechanisms that led to the collapse of LUNA.
"Will STRC become the new LUNA? In short — not exactly," wrote Arkham experts. "Saylor cannot lose funds due to a drop in STRC. The value of STRC only shows how much the market believes in the continuation of dividend payments from Saylor."
A key point highlighted by Arkham analysts: dividend payments on preferred shares remain at the company's discretion. If Strategy faces problems, Saylor is not obligated to prioritize dividends for STRC shareholders. According to Arkham's estimates, maintaining the current payout order for STRC requires approximately $1.2 billion per year. This is a colossal burden that calls into question the sustainability of the financing model if market conditions deteriorate.
Analyst's View: Panic or Justified Risks?
Well-known analyst Shanaka Anslem urged not to dramatize the situation. He emphasizes that the Rosen Law Firm notice is a standard tool for law firms to find clients after a sharp drop in stock prices, not evidence of fraud. "There is no SEC lawsuit, no DOJ case. No lawsuit has been filed, no specific misrepresentations have been identified," he noted. And he is right — at this point, it is merely the beginning of an investigation into potential claims.
My conclusion: While the Rosen Law Firm's initiative itself is not a verdict, it highlights a systemic vulnerability in Strategy's model. The company finds itself in a situation where its financial stability directly depends on its ability to generate sufficient cash flow to service an increasingly complex capital structure. Even if there are no legal consequences, the market has already begun to reassess the risks embedded in Strategy's stocks and bonds. Investors should closely monitor the company's ability to pay dividends on preferred shares amid bitcoin volatility. This, in my view, is a much more significant signal than the lawyers' notice itself.