Fidelity: Demand for Bitcoin Driven by Preferred Stocks

Wall Street Unearths a Familiar Investment Vehicle for Bitcoin Acquisition

A novel approach to Bitcoin investment is emerging on Wall Street, drawing inspiration from financial instruments reminiscent of those favored by previous generations. According to a report by Fidelity Digital Assets, perpetual preferred stocks issued by companies holding Bitcoin reserves have facilitated the acquisition of 135,979 BTC in just over a year.

As of October 5, 2026, this substantial figure represents more than 0.5% of Bitcoin’s total circulating supply. The report, released on October 20, 2026, identifies these instruments as a genuine driver of Bitcoin demand and a potential gateway for the vast world of fixed-income investors.

Understanding Perpetual Preferred Stocks

Perpetual preferred stocks can be understood as bonds that never mature. Investors provide capital in exchange for regular dividend payments from the issuing company, with no predetermined date for the return of their principal investment.

This structure proves advantageous for Bitcoin treasury companies. It allows them to raise funds from income-oriented investors and deploy that capital into Bitcoin purchases without diluting common stock ownership or incurring traditional debt.

A Surge in Issuance

The adoption of this strategy accelerated significantly in 2026. Fidelity data indicates that between March and May of that year, issuers collectively raised over $7 billion through these offerings. This capital infusion was directed towards the purchase of more than 95,000 BTC within that three-month period alone. April marked the peak of this activity, with Fidelity’s data showing nearly 30,000 BTC acquired in a single week that month.

Reaching New Investor Pools

Fidelity has been careful to distinguish these products from spot Bitcoin exchange-traded products, which launched in January 2024 and amassed 888,185 BTC in their inaugural year. The firm’s emphasis lies not on raw volume, but on the investor base these new instruments can attract. Fidelity views perpetual preferred equity as a means to access the significantly larger fixed-income market, estimated to be worth approximately $150 trillion. Furthermore, the firm suggests these vehicles can offer yields that outpace many traditional cash equivalents.

Pioneering the Model

The genesis of this investment model can be traced back to Strategy, which introduced its first perpetual preferred stock product in July 2025. This initial offering paved the way for other firms, including Strive, which Fidelity recognizes alongside Strategy as a key innovator in this structure. Fidelity has been developing this investment thesis for some time, having highlighted in September 2026 commentary the potential of preferred equity as a form of Bitcoin-backed digital credit, appealing to fixed-income investors.

Market Impact and Risks

Funds raised through perpetual preferred stock offerings are directly channeled into Bitcoin purchases, thereby translating each successful issuance into tangible buying pressure on the open market. However, this model is not without its risks. Perpetual preferred stocks carry ongoing dividend obligations that persist regardless of Bitcoin’s price fluctuations. Issuers are essentially committing to fixed income backed by a highly volatile asset. Should Bitcoin experience a prolonged downturn, the market’s resilience will be tested, scrutinizing the sustainability of these promises and the continued investor appetite for new issuances.

For investors, key indicators to monitor include the volume of new preferred stock issuances and the proportion of these funds converted into Bitcoin acquisitions. The yields offered by these products relative to traditional cash equivalents will also serve as a crucial signal of sustained interest from fixed-income buyers.