S&P Global Ratings has assigned a B- issuer credit rating to Strategy Inc, the company formerly known as MicroStrategy. The rating comes with a stable outlook, meaning S&P does not expect any major changes in the near term.
Strategy Inc is well known for its unconventional business model. Instead of using its capital primarily to grow its software business, the company raises funds through debt and equity and uses it to buy Bitcoin. Today, the company acts more as a Bitcoin holding vehicle than a traditional technology company.
S&P Global Ratings has assigned Strategy Inc a “B-” (outlook stable) issuer credit rating – the first-ever rating of a Bitcoin treasury company by a major credit rating agency.
– Strategy (@Strategy) October 27, 2025
S&P says this structure gives investors a way to gain exposure to Bitcoin without owning it directly. But it also carries significant risks.
Why S&P downgraded the strategy
According to S&P, the B- rating reflects several weaknesses:
- Extreme concentration of Bitcoin
- Low liquidity of the US dollar
- Negative capital situation once Bitcoin is excluded
- Dependence on capital markets for financing
- Limited operating cash flow
S&P considers Strategy’s balance sheet risky because the company primarily holds Bitcoin, but its debts and dividends must be paid in dollars. Since the company does not want to sell Bitcoin to cover costs, it continues to raise capital through stocks, preferred shares, and convertible debt.
Strategy acquired 390 BTC for ~$43.4 million at ~$111,053 per bitcoin and achieved a 26.0% BTC return since the start of 2025. As of 10/26/2025 we held 640,808 $BTC acquired for ~$47.44 billion at ~$74,032 per bitcoin. $MSTR $STRC $STRK $STRF $STRD
– Strategy (@Strategy) October 27, 2025
S&P also noted that although Bitcoin has performed strongly, its price fluctuations could become an issue. If Bitcoin falls sharply just as the debt comes due, the company may have to sell Bitcoin at a loss or restructure its debt.
What S&P predicts for the future
Even with these risks, S&P says the outlook remains stable. The agency expects the strategy to:
- Continue to manage debt maturities responsibly
- Maintain access to capital markets
- Continue to use equity and debt to pay your obligations
S&P does not expect regulators to take action that would disrupt the company’s Bitcoin-focused model.
However, S&P warned that the rating could fall further if Bitcoin collapses or the company struggles to raise new funds. On the other hand, a revaluation is unlikely in the near future, unless the strategy reduces debt and strengthens dollar liquidity.
Everyone, please read this regarding Strategy’s credit rating.
It’s hilarious
S&P Global: “We will likely continue to view capital as a weakness as the strategy’s bitcoin holdings are likely to grow significantly”
So basically, “the more Bitcoin they buy, the weaker they are… pic.twitter.com/vC4khB4sog
–Adam Livingston (@AdamBLiv) October 27, 2025
Strategy Inc’s bold Bitcoin play has made it a unique company on Wall Street. It is part software company and part Bitcoin vault. The S&P rating shows the tradeoff: a sharp rise in Bitcoin bull markets, but financial difficulties if the crypto becomes volatile. With billions in debt coming due in the coming years, the company’s ability to raise capital will remain key to its strategy.
Disclaimer
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The article S&P Downgrades Strategy to B- for Bitcoin Focus appeared first on Altcoin Buzz.
