BTC Hurdle ARR

BTC Hurdle ARR is the issuer's own metric, introduced by Strategy on strategy.com in July 2026. Strategy defines it as follows: it "represents Strategy's current effective cost of credit. If BTC ARR is above this rate, Net BTC Per Share captures a positive spread and appreciates faster than bitcoin on a go-forward basis" (FWP, 24 August 2026).

"BTC ARR" is Strategy's term for an assumed annualised rate of return on bitcoin. It is an input for illustration, not a forecast.

Formula

The filings reviewed by 21DC define the Hurdle ARR in words ("current effective cost of credit") and do not publish the arithmetic behind it. For comparison, Strategy publishes a related measure with an explicit formula: BTC Breakeven ARR = annual interest and dividends ÷ BTC Reserve. That is the bitcoin return needed to fund those payments from bitcoin gains (same source).

Reported figures

The August briefing set out a simple sensitivity per $1bn of digital credit: at an assumed 15% BTC ARR, the spread over the 10.74% hurdle is about +$43m a year, and at 5% it is about −$57m. Strategy called this "a first-order illustration, not a projection".

Relevance to preferred holders

The hurdle reflects the dividend rates on STRF, STRC and the other series, plus debt costs. It is a measure of whether issuing digital credit helps common shareholders. It says nothing about whether preferred dividends will be paid. For that, see the coverage bridge, BTC Rating and USD Reserve.

What to check in the filing

• The current figure and its date on Strategy's disclosures
• The claims and rates included
• Strategy's caveats on illustrative metrics