Fidelity Digital Assets calls perpetual preferreds a new source of bitcoin demand, equal to about 15% of what U.S. spot ETPs bought in their first year. It also warns that the model works only if bitcoin rises faster than the dividends cost.
One of 2026's main sources of bitcoin buying now has a number attached. The timing of that buying is the more revealing part.
Fidelity Digital Assets said in research published on Tuesday that perpetual preferred stock issued by bitcoin treasury companies has financed purchases of 135,979 bitcoin through Oct. 5. The model, which Fidelity dates to Strategy's July 2025 launch of its STRC preferred, is to "issue a perpetual preferred stock with an attractive yield to raise capital, with the sole objective of accumulating bitcoin." Fidelity put these preferreds at about $12 billion of market value, based on data from June. Strategy had sold other perpetual preferreds, beginning with STRK, earlier in 2025.
How big that is
The total equals about 0.65% of bitcoin's 21 million maximum supply. Fidelity compared it with U.S. spot exchange-traded products, which accumulated 888,185 bitcoin in their first year. On that basis, the preferred channel has financed about 15% as much as the ETPs did.
When it happened
The buying was concentrated. Issuers raised more than $7 billion and bought more than 95,000 bitcoin from March to May, about 70% of the total. That included more than 22,000 in March and more than 48,000 in April, nearly 30,000 of them in a single week.
That concentration fits other evidence that the channel has slowed. Strategy's recent weekly filings show it spending more on buying back its STRC preferred, about $192 million in the latest week, than on bitcoin, about $22 million. New issues are pricing at much higher yields. Strive's SATS preferred, which began trading on Tuesday, carries a 15% dividend on its stated value.
Fidelity's own caveat
Fidelity is clear about the condition attached. "For issuers, the strategy only works if the appreciation of the underlying asset outpaces the cost of yield," the report says, adding that the instruments "carry an additional layer of risk."
That hurdle is rising. Bitcoin was about $83,270 early Wednesday, roughly 28% below its 52-week high of $116,410, set in October 2025, and about 15% below its 2026 high near $97,960, while new preferreds are being sold at yields in the mid-teens. A treasury company needs bitcoin to rise faster than that dividend every year for common shareholders to come out ahead.
Treasury shares still respond sharply to bitcoin's moves. Strategy rose 4.9% on Tuesday and Strive's common stock gained $1.52 to $27.06.
Market implications
One reading is that income investors are a large and durable new source of demand. A channel that financed nearly 136,000 bitcoin has shown it can scale.
A second reading is that the channel is cyclical. Most of its buying happened in the spring, and higher coupons now make new issuance harder to justify.
A third reading is that the structure carries a forced-selling risk. Fixed dividends must be paid in down markets too, and issuers without other income may have to sell bitcoin to meet them.
What to watch
New preferred issuance by Strategy, Strive and others; dividend coupons on new deals; Strategy's special meeting on Oct. 28 and third-quarter results on Oct. 29; SATS trading against its $90 offer price; and bitcoin's price relative to the cost of yield. A new preferred priced below a 12% coupon would show demand returning on easier terms.