Strategy erased nearly $8 billion of net debt in 11 months and put S&P’s junk rating on the clock
Strategy, the largest Bitcoin treasury agency, is making a case for an escape from its B- junk credit score rating after constructing billions of {dollars} in liquidity and lowering debt.
On Sept. 10, Strategy’s head of investor relations, Chaitanya Jain, said the Michael Saylor-led firm has strengthened its stability sheet in the three areas S&P Global Ratings beforehand recognized as potential paths to an improve: greenback liquidity, convertible debt, and capital-market entry throughout Bitcoin stress.
S&P affirmed Strategy’s B- issuer credit score rating with a steady outlook in December 2025, after initially assigning the grade in October. The rating stays six notches under BBB-, the lowest rung of funding grade.
Strategy builds the money cushion S&P needed
The sharpest shift has come in the quantity of greenback liquidity sitting between Strategy’s Bitcoin holdings and its monetary obligations.
Jain mentioned greenback liquidity elevated from $54 million on Sept. 30, 2025, to $6.54 billion as of Sept. 7, giving the firm roughly 4 years of capability to fund curiosity and most popular dividends with out relying on Bitcoin sales.
Strategy’s newest regulatory submitting breaks that quantity into two swimming pools. Its designated USD Reserve stood at $5.10 billion, whereas one other $1.44 billion was held as USD Cash. The reserve is earmarked for most popular dividends and curiosity, whereas the more money may also be used for Bitcoin purchases, safety repurchases, and different capital-management purposes.
That leaves Strategy with significantly extra flexibility during times when issuing new securities turns into tough.
S&P had recognized the firm’s liquidity construction as a central weak spot as a result of its debt curiosity, maturities and most popular dividends are payable in {dollars} whereas most of its property are held in Bitcoin. The company warned {that a} extreme decline in Bitcoin mixed with decreased capital-market entry may finally power Strategy to promote the asset at depressed costs.
The firm has additionally decreased the debt instrument S&P singled out as a possible supply of stress.
Convertible debt has fallen to $6.71 billion from $8.21 billion after Strategy repurchased $1.5 billion of its 0% convertible senior notes due 2029 in May. It paid about $1.38 billion for the notes, an 8% low cost to par.
Jain mentioned net debt, measured towards the firm’s rising greenback liquidity, has consequently dropped from about $8.16 billion after the third quarter of 2025 to roughly $174 million as of Sept. 7.
That calculation doesn’t eradicate Strategy’s broader obligations. The firm nonetheless carries billions of {dollars} of perpetual most popular inventory with dividend commitments that stay half of the liquidity burden S&P considers.
Strategy’s financing machine remained open by means of Bitcoin stress
Strategy can also be pointing to its potential to maintain promoting securities by means of 2026 as proof that the financing channel S&P feared may weaken throughout a Bitcoin downturn has remained open.
Jain mentioned the firm raised $21 billion throughout widespread and most popular fairness from January by means of August, securing capital in each month of the interval. During this era, BTC worth dumped greater than 30% and fell to beneath $60,000. Its worth has since recovered close to $80,000 as of press time.
Despite this worth motion, Strategy continued to draw significant investor fundraising.
S&P made continued market entry central to either side of its scores outlook. The company mentioned it may downgrade Strategy if deteriorating Bitcoin costs impaired its potential to lift capital or elevated the chance that it couldn’t handle out-of-the-money convertible debt.
Its upside case ran in the wrong way. An extended-term improve would require stronger greenback liquidity, decreased reliance on convertible debt, and continued capital entry by means of a interval of Bitcoin stress.
Bitcoin focus stays the hurdle
The balance-sheet enhancements depart S&P with a distinct credit score profile to evaluate, however they don’t take away the structural characteristic that has weighed most closely on Strategy’s rating.
Strategy stays overwhelmingly uncovered to Bitcoin.
As of Sept. 9, the firm held 845,050 BTC acquired for $63.73 billion at a mean worth of about $75,412 per coin. That leaves a lot of its stability sheet uncovered to an asset succesful of sharp drawdowns, even after Strategy constructed a bigger greenback cushion towards its fee obligations.
S&P highlighted that focus danger, saying the firm’s (*11*) and comparatively small software program enterprise restricted the potential for the next rating.
The query now could be whether or not the new liquidity and debt profile offers sufficient safety towards that danger to justify a reassessment.
S&P has taken no contemporary rating motion since the newest balance-sheet modifications, and Jain stopped brief of predicting one. He mentioned:
“More liquidity. Less debt. Continued funding entry. Any rating improve stays S&P’s resolution.”
The timing may quickly put that argument to the take a look at. S&P mentioned in October 2025 that an improve was unlikely inside 12 months, a interval that runs by means of late October 2026.
The put up Strategy erased nearly $8 billion of net debt in 11 months and put S&P’s junk rating on the clock appeared first on CryptoSlate.
