In the first-ever rating for a Bitcoin treasury company, S&P just rated Michael Saylor’s Strategy Inc. a B- junk credit.
Summary
- S&P has assigned Strategy a B- junk rating.
- Rating cites Bitcoin exposure, low liquidity, and concentrated risk.
- Marks first-ever rating for a Bitcoin treasury-focused company.
S&P Global Ratings has assigned Strategy Inc., the Bitcoin-treasury company formerly known as MicroStrategy, a B- credit rating, placing it six notches below investment grade.
The report, published by Bloomberg on Oct. 27, stated that the rating reflects Strategy’s deep concentration in Bitcoin (BTC) and limited diversification, as well as concerns about liquidity and risk-adjusted capitalization.
S&P cites Bitcoin exposure and weak liquidity
Strategy Inc., led by Michael Saylor, has spent the past five years transforming from an enterprise software firm into a company built around Bitcoin accumulation. It now holds 640,808 BTC, worth around $74 billion, making it the world’s largest corporate holder of the asset.
According to S&P, Strategy is extremely vulnerable to changes in the market because of its significant exposure to Bitcoin. Its main software business makes little money and provides little defence against a decline in cryptocurrency prices. The company reported $37 million in negative operating cash flow during the first half of 2025 and maintains minimal dollar reserves, as most of its treasury is tied up in BTC.
The agency also highlighted liquidity and currency mismatch risks. Strategy holds about $8 billion in USD-denominated convertible debt maturing between 2028 and 2031, and preferred stock dividends exceed $640 million annually. A prolonged drop in Bitcoin’s price, S&P warned, could make it harder for the company to meet those obligations.
Despite these vulnerabilities, S&P maintained a stable outlook, assuming Strategy will manage its financing needs through stock offerings and structured debt sales, methods it has used to fund recent Bitcoin purchases, including a recent 390 BTC buy worth $43.4 million.
Industry milestone for Bitcoin treasuries
Saylor described the rating as a milestone for Bitcoin adoption in traditional finance, noting it was the first time a major credit agency had formally evaluated a BTC-focused public company. He called it a “step toward normalization,” framing the rating as recognition rather than a setback.
Analysts see the move as setting a reference point for other Bitcoin-heavy firms such as Metaplanet and Marathon Digital, which may seek similar evaluations. While the B- B-grade keeps Strategy in speculative territory, it marks progress in bridging the gap between crypto-based business models and traditional capital markets.
Strategy rebranded from MicroStrategy earlier this year, fully embracing its identity as a Bitcoin treasury company. Its third-quarter earnings, due Oct. 30, will offer further insight into how it balances debt, cash flow, and exposure to the world’s most volatile asset.
