Strategy Inc's STRC: Impact on US Private Credit Market and Percolation to Global Systemic Risk

Author: Shutosa Date: January 2026 Subject: The structural demonetization of the USD 315 Trillion Global Credit Market by Bitcoin-backed equities.

1. Executive Summary: The USD 300 Trillion Target

While the media fixates on Bitcoin's price, the real story is the "vampire attack" on the global credit market. We are not just talking about a tech stock; we are witnessing the emergence of a superior form of savings that renders traditional fixed income obsolete.

The global debt market stands at roughly USD 315 Trillion (IIF data). The US Fixed Income market alone is approximately USD 59 Trillion (SIFMA), with the "vulnerable" corporate and high-yield sectors representing a USD 10-12 Trillion wedge. STRC (Strategy Inc) acts as the "thin end of the wedge," cracking this monolith open by offering a liquid, yield-bearing instrument that exposes the "Illiquidity Premium without Real Yield" flaw of traditional bonds.

2. Market Sizing & Vulnerability Analysis

To understand the magnitude of the threat STRC poses, we must break down the targets.

The Global Credit Ocean (USD 315 Trillion)

• Sovereign Debt (~USD 91T): The bedrock. Vulnerable to "Fiscal Dominance" and inflation.
• Corporate Debt (~USD 95T): The immediate target. Vulnerable to cost-of-capital repricing.
• Household/Private Debt (~USD 60T): Mortgages, etc.

The "Kill Zone": US Fixed Income Breakdown

The most immediately vulnerable sectors are those where investors take risk for yield. STRC competes directly here.

The Trigger Point: It does not take 50% adoption to break the system. Markets are priced at the margin. If just 3-5% of the Global Corporate Debt market (~USD 5 Trillion) rotates into STRC-like instruments to chase real yield, spreads would blow out, creating a liquidity crisis that forces Central Banks to intervene (print money), which only fuels the Bitcoin fire.

3. The Global Expansion Mechanism

Strategy Inc is not limited by US borders. It has technically mastered the art of "Capital Accretion."

• Infinite Issuance: Unlike Gold miners who run out of veins, STRC can issue infinite equity (ATM offerings) as long as the Bitcoin price (in fiat) keeps rising.
• Global Appetite: International investors—starved of safe US assets—desperately want exposure to STRC.
• The "Treasury Backstop": Why? Because STRC is not just a Bitcoin proxy. It holds a USD 2.1 Billion War Chest of US Treasuries (Cash Equivalents).
  • To a foreign investor, buying STRC is like buying a "Super-Treasury": You get the safety of the USD cash cushion plus the upside of the hardest asset.

4. The Political "Checkmate": The Biggest Holder of Treasuries

Critics arguing for a ban on STRC miss the geopolitical reality. STRC is becoming a structural pillar of the USD system.

• The Mechanics: To manage its volatility and maintain its war chest, STRC constantly raises dollars. It parks these billions in short-term US Treasuries (T-Bills).
• The Projection: As STRC scales to a Trillion-dollar market cap, its "Cash Cushion" will grow to USD 50B, then USD 100B.
• The Shield: You cannot attack a company that is one of the largest buyers of your government's debt. By emerging as a massive holder of US Treasuries, STRC aligns its incentives with the US State.
  • Attack STRC? You crash the T-Bill market.
  • Support STRC? You guarantee a constant buyer for your deficit spending.

5. The Futility of Resistance: A "Maginot Line" Defense

Trying to stop Strategy Inc via "B-" ratings or MSCI exclusion is a "Maginot Line" defense—fighting the last war.

• Containment Fails: Exclusion from indices only highlights the underperformance of the index. If the S&P 500 excludes the best-performing asset of the decade, the S&P 500 becomes a "bad product."
• More Publicity: Every negative article or rating action serves as free advertising, educating another pension fund manager about the "Bitcoin Yield" alternative. This mirrors the public relations backlash seen in other regulatory battles within the digital asset space.

6. The Coinbase Precedent: Why Containment is Futile

The attempts to sideline STRC through legacy financial gatekeeping tools—such as MSCI Index exclusions and "B-" credit ratings—are not just ineffective; they are counterproductive. This strategy is destined to fail, not just for financial reasons, but due to a groundswell of political and public support, creating a scenario directly analogous to the SEC's ill-fated conflict with Coinbase.

When the SEC issued Coinbase a Wells notice, it inadvertently galvanized a massive, politically active retail base and forced a public debate on the merits of cryptocurrency. The result was not a successful containment but a public relations disaster for the regulator, as public and political support rallied behind Coinbase.

Similarly, every attempt to "punish" Strategy Inc for its innovative treasury strategy serves as a public endorsement. It signals to a growing and politically engaged investor base that STRC is a threat to a legacy system they already distrust. This "Streisand Effect" on a geopolitical scale turns containment efforts into a powerful marketing campaign, solidifying STRC's position as a champion of a new, more equitable financial paradigm. The outcome is pre-ordained: the market, backed by the will of the people, will route around the gatekeepers.

The Action Plan:

1. Corporations: Stop holding cash. Issue debt to buy the new global collateral.
2. Sovereigns: Recognize that "Capital Controls" won't work in a digital age. You must offer a competitive product (sound money) or hedge your treasury with the winner (Bitcoin).

Final Reality: STRC is the "Trojan Horse" that re-monetizes the world with Bitcoin, all while wrapping itself in the American Flag and the US Treasury Bill.