---
title: "The Bitcoin Credit Monopoly: Why Strategy's Moat Is Fixed Income, Not Equity"
author: "Dan Hillery"
author_url: "https://tnorth.com/crew/dan-hillery/"
publisher: "True North"
publisher_url: "https://tnorth.com"
canonical_url: "https://tnorth.com/research/bitcoin-credit-monopoly-strategy-fixed-income-moat/"
markdown_url: "https://tnorth.com/research/bitcoin-credit-monopoly-strategy-fixed-income-moat.md"
date_published: "2025-05-30"
date_updated: "2025-05-30"
rendered_at: "2026-05-02T14:13:21.971Z"
section: "research"
tickers: ["MSTR", "STRF", "STRK"]
instruments: ["MSTR", "STRF", "STRK"]
asset_class: "perpetual-preferred-equity-bitcoin-backed"
word_count: 493
reading_time_minutes: 2
license: "© 2026 True North. Cite with attribution and a link to the canonical URL. Not investment advice."
disclosure: "True North is operated by Strive, Inc. Independent contributor content published under https://tnorth.com/legal/independent-discussion/."
tldr_generated: true
---

# The Bitcoin Credit Monopoly: Why Strategy's Moat Is Fixed Income, Not Equity

> **TL;DR.** Dan Hillery explains why Strategy's real competitive advantage isn't buying Bitcoin at a premium — it's the emerging monopoly on issuing digital credit instruments like STRK and STRF.
> — Dan Hillery, True North (https://tnorth.com/research/bitcoin-credit-monopoly-strategy-fixed-income-moat/)

[$MSTR](https://www.strategy.com/) Long Term

It all can be reduced to **ARBITRAGE**.

*The BTC conference convinced me that Bitcoin financial services and products will tend towards the company that is most capable of issuing credit worthy securities.

This business is about Trust & Collateral

[Jeff Walton](/crew/jeff-walton/).

Two most important takeaways from Strategy's messaging at the Bitcoin conference.

1) Phong will sell preferred shares to buy back common stock if the equity trades below 1X MNAV.

2) Strategy is looking to issue credit instruments in different capital markets around the world. (This is actually a product).

BTC yield is a way to measure the value accrued to shareholders as a result of accretive behavior. In the case of Strategy, all of this value has been the result of ARBITRAGE. Why do these companies generate BTC yield? Well in the case of Strategy, the preferred security issuance is more important than people realize.

**Phase 1)** Strategy's ATM has been one huge arbitrage between the design of the equity markets and the demand for Bitcoin exposure. (The credit worthiness of a public company, ability to issue debt, ability to margin securities, ability for investors to access Bitcoin exposure) (Such an arbitrage required cash flow + Convertible debt to help justify a premium (Non margin-able Bitcoin leverage)).

**Phase 2)** The preferred issuance is much different than convertible issuance. We all wanted yield on Strategy's Bitcoin stack. That's exactly what we got. Preferred's represent a massive arbitrage between the bond market yields and Bitcoin's CAGR.

Such issuance is only possible as a result of the Bitcoin on Strategy's balance sheet.

What are they doing? Where is the value accrued here? It's the difference between the yield of [STRK](/digital-credit/markets/strk/) and [STRF](/digital-credit/markets/strf/) and the CAGR of Bitcoin.

**The issuer with the most collateral will win the above competition.** The fixed income investor doesn't care about your "Bitcoin yield," it cares about the collateralization of their bond by the net Assets held on the balance sheet of the issuing corporation as well as the trustworthiness and track record of the management team.

The credit worthy companies will accrue more value by issuing fixed income instruments because they will be able to offer lower yields, and thus result in higher arbitrage between BTC's CAGR and the securities' yield.

**Less credit worthy BTC treasuries will be forced to issue higher yields, which will be less accretive to common stock holders.**

For any of this to work, you have to have future expectations of Bitcoin's CAGR. That is the absolute key here.

**Takeaway:**

It's going to be very difficult for companies in other markets, long term, to compete with the fixed income products, or swaps, that Strategy is beginning to issue, as they enter new jurisdictions.

I believe this is largely the reason for aggressive ATM issuance.

**There is no monopoly in issuing equity for Bitcoin at a premium.**

**However, there is very much so an monopoly on issuing Bitcoin backed credit.**

That's where we stand.

## About this document

Canonical HTML: https://tnorth.com/research/bitcoin-credit-monopoly-strategy-fixed-income-moat/
Site-wide AI index: https://tnorth.com/llms.txt