The Hurdle Rate Podcast Episode 33 - Credit Ratings for Digital Capital
10 snips
Oct 28, 2025 Discover the implications of S&P's new credit rating for digital assets and how it could reshape the insurance industry. The hosts delve into why lower ratings can unlock institutional investments and the importance of Bitcoin's treatment by rating agencies. They discuss factors influencing credit ratings, explore how payment frequency builds trust, and examine the role of banks in promoting market confidence. With insights on macroeconomic influences and market momentum, this conversation is packed with intriguing ideas for the future of digital capital.
AI Snips
Chapters
Transcript
Episode notes
Conservative Rating Despite Strong Bitcoin Capital
- S&P gave Strategy a B- issuer rating despite large Bitcoin holdings and yields that suggest stronger creditworthiness.
- The rating likely reflects conservative institutional trust and conflict incentives at rating agencies.
Interest Coverage Favors Higher Ratings
- Using interest-coverage analogies, Strategy's prefs look like high-rated debt if Bitcoin earns modest positive CAGR.
- Even low assumed Bitcoin growth makes interest coverage multiples consistent with investment-grade ratings.
Bitcoin Treated As Non-Capital In Report
- S&P's report treated Bitcoin as something that doesn't count as capital, creating a currency-mismatch critique.
- The agency flagged concentration in Bitcoin as a persistent rating drag.