Michael Saylor has published a Bitcoin credit model that shows how much BTC sits behind every dollar MicroStrategy owes its bondholders and preferred shareholders.

The tool assigns each instrument a credit tier and a floor price. Investors can now see the Bitcoin level at which any given security stops being fully collateralized.

Inside Saylor’s Bitcoin Credit Model

Strategy held 843,775 BTC at the close of the second quarter. Its balance sheet still carries $6.71 billion in convertible notes alongside several preferred stock series.

The model tests those obligations against a single reference case, a 10% annual Bitcoin return. Each instrument then receives a credit spread, a rating, and a collateral reading.

Saylor color-codes the output. Spreads drop into familiar buckets that run from investment grade through high yield down to distressed.

That choice pulls Strategy into the language of traditional fixed income. No major agency rates the company’s convertibles or preferred shares, so Saylor built the scorecard himself.

The framing invites direct comparison with corporate bonds. Fund managers can now slot Strategy’s paper beside conventional credit rather than treating it as an opaque Bitcoin proxy.

The dashboard also extends the work Strategy started in July. Its second-quarter report introduced a BTC Hurdle ARR of 10.8%, the effective cost of the company’s credit stack.

Why the Floor Prices Sting

Floor prices form the sharpest part of the release. Each one marks the Bitcoin price below which a specific instrument turns undercollateralized.

BTC currently trades near $63,758 after a mild slip, roughly 49% under its October 2025 record of $126,080. That gap leaves far thinner headroom than bulls enjoyed last year.

Consequently, the distance between spot and each published floor now doubles as a live solvency gauge.

Strategy keeps a $3.75 billion cash reserve, enough to cover roughly 2.1 years of dividend and interest payments. Cumulative preferred dividends have already reached $1.06 billion.

The firm has also leaned on its treasury to defend the equity stack. In August, it turned to fresh Bitcoin sales to fund buybacks of Strategy’s STRC preferred stock, a variable-rate security with a $100 par value. Saylor meanwhile kept repeating his $100 STRC target.

Critics counter that Strategy’s Bitcoin income metrics flatter the underlying performance. Floor prices cut the other way. They publish the exact level at which the capital structure cracks.

Transparency carries a cost. Traders who once argued over whether STRC survives 2026 can now anchor that debate to a number Saylor supplied himself.

Source: BeInCrypto