S&P Global Ratings has assigned Michael Saylor’s Strategy a "B-" credit rating, placing it in the speculative, non-investment-grade territory, often referred to as a “junk bond.” The credit rating agency noted that the Bitcoin treasury company’s outlook remains stable.
The credit rating platform stated in a review of Strategy on Monday, "We view Strategy’s high bitcoin concentration, narrow business focus, weak risk-adjusted capitalization, and low US dollar liquidity as weaknesses."
Strategy has accumulated its 640,808 BTC treasury primarily through equity and debt financing. The stable outlook assumes the company will prudently manage convertible debt maturities and maintain preferred stock dividends, potentially through additional debt issuance.
S&P Global highlighted that Strategy faces an "inherent currency mismatch," with all debt due in US dollars while much of its dollar reserves are allocated to fund its software business, which operates at approximately breakeven in earnings and cash flow.
The credit rating is significant as it marks the first time a Bitcoin-treasury-focused company has received an S&P Global assessment. This establishes a benchmark for traditional finance to evaluate the credit risk of companies that center their business models around Bitcoin and crypto.
Strategy's Rating on Par with Sky Protocol
Strategy received the same score as decentralized stablecoin issuer Sky Protocol, formerly MakerDAO, in August.
S&P Global pointed to Sky Protocol’s high depositor concentration, centralized governance, and weak capitalization to justify the B-minus rating.
Strategy’s B-minus rating will need to increase six levels to BBB-minus in order to escape the “junk bond” zone.
The latest rating comes as Strategy was one of the Nasdaq’s best-performing stocks in 2024, rallying 430%. MSTR has, however, retraced 13% so far in 2025, according to Google Finance data.
This includes a 2.27% rise on Monday, indicating that S&P Global’s rating did not negatively impact the company’s share price.
Key Factors for Rating Improvement: US Liquidity and Debt Reduction
While S&P Global indicated that an upgrade in the next 12 months is unlikely, it noted that it could raise the ratings if Strategy improves its US dollar liquidity, eases convertible debt, and continues to demonstrate strong access to capital markets, including during periods of Bitcoin retracement.
However, S&P Global identified a risk that Strategy’s convertible debt may become due during a "severe Bitcoin stress" event. This could force the company to liquidate some of its Bitcoin holdings at depressed prices.
Strategy’s credit score could also decline if its access to capital markets weakens, impacting its ability to raise funds and sustain its Bitcoin strategy.