Variable-rate preferred

A variable-rate preferred pays a dividend rate that the issuer can change from one period to the next. The issuer announces the rate before the period begins, and the rate adjustment mechanism in the terms limits how much it can be cut. In digital credit, the variable rate is the main tool for par-targeting.

How it applies to STRC

STRC launched on 29 July 2025 at 9.00%. Strategy raised the rate in steps to 12.00% for periods with record dates from 1 July 2026, and on 15 October 2026 stated 12.00% for November 2026 record dates (8-K, 15 October 2026). The certificate of designations allows the rate to be set at Strategy's discretion. Cuts are limited, and the rate may not go below one-month term SOFR (8-K, 29 July 2025).

How it applies to SATA

SATA started at 12.00% on 10 November 2025 and rose in 25bp steps to 13.00% for periods from 15 April 2026. It has been held at 13.00% through November 2026 (8-K, 13 October 2026). The rate is set per monthly period even though dividends have been paid every business day since 16 June 2026.

Other issuers

The Smarter Web Company's MORE preferred has an initial variable rate of 12% a year on £100, which its board may vary within the prospectus parameters (company announcement, October 2026; parameters not yet verified by 21DC). Metaplanet's planned Class A "MARS" is described in press coverage as a monthly floating-rate design, but it had not been issued as of the latest source (May 2026).

Compared with fixed-rate

A fixed-rate preferred keeps the same coupon for ever, so its price takes most of the adjustment to market conditions. A variable-rate preferred moves some of that adjustment into the dividend. Its price may then be steadier, but the income varies.

What to check in the filing

• Who sets the rate, and how much notice is given
• Floors and limits on cuts
• Whether cuts are blocked while dividends are unpaid