Digital Credit: Comparing The Six Bitcoin Preferred Stocks

Digital credit is an emerging asset class that transforms corporate Bitcoin balance sheets into income producing securities. Strategy pioneered the market with five perpetual preferred equity instruments: STRK, STRF, STRD, STRC, and STRE (the first four are listed in the U.S.). Strive subsequently introduced SATA and SATS, bringing the category to six U.S. instruments across two issuers.

These securities offer investors preferred equity (read: credit-like) exposure to companies whose balance sheets are dominated by Bitcoin. Their perpetual structure means investors principally rely on recurring dividends and the continued financial strength of the issuer. Unlike term debt, there is no maturation date at which the full principal is ever paid back. 

Evaluating digital credit requires examining four characteristics: creditworthiness, investor protections, liquidity, and dividend profile. 

This article explains all four dimensions and then offers a ranking for the six digital credit instruments along these lines. None of this should be taken as investment advice—it is only a systematic framework for analyzing digital credit. 

1. Creditworthiness

Creditworthiness measures an issuer’s ability to support its financial obligations.