The senior token, SR-strcUSX, is designed to receive income first and targets a yearly yield of 7%. The junior token, JR-strcUSX, takes the residual income after senior holders are paid and targets more than 20% APY. In return, junior holders absorb losses from changes in the value of the STRC position before senior holders do.
The product is the first STRC-linked instrument on Solana, according to Solstice.
STRC, known as Stretch, is Strategy’s variable-rate perpetual preferred stock. It currently pays a 12% annual dividend in cash, with payments twice a month, but the rate is set by Strategy’s board and dividends remain subject to declaration.
STRC may continue to pay its dividend while its market price falls. The senior tranche is meant to shield holders from part of that mark-to-market risk, while the junior tranche takes on more of it in exchange for the higher yield earning potential.
Solstice said users can redeem after a seven-day unlock period or exit immediately for a fee. Yield accrues through the token’s exchange rate rather than being paid as a separate distribution.
