Charlie Andrys

Again, private credit is cracking. Morgan Stanley put out an 8% default rate projection for direct lending. AI is repricing the software sector, and software companies make up 25-35% of many private credit portfolios. These are companies that borrowed at peak valuations when rates were low, and now their competitive moats are eroding faster than anyone modeled. Blackstone had $3.8B in withdrawal requests on BCRED. Cliffwater capped redemptions at 14%. Blue Owl stopped them entirely. The capital leaving private credit needs a destination. It needs yield, liquidity, and something resembling honest pricing. I think digital credit built on Bitcoin is that destination, and the reallocation hasn’t even started yet.

People aren’t bad at saving, they’re just saving in the wrong things.

GM Strategy bought 22,337 BTC last week. Over 0.1% of the total supply. $1.18 billion came from STRC. “Only” $396 million from selling MSTR common equity at a ~1.14x mNAV. The preferred instruments are now the primary engine. Strategy is layering credit on top of Bitcoin as a reserve asset. STRC pays 11.50% yield, adjusts monthly, trades ~$100 par, and is overcollateralized roughly 5x. It functions more like a fixed-income instrument than an equity position, but the collateral underneath is the hardest money ever created. Hal Finney wrote about this kind of architecture years ago. He envisioned Bitcoin transactions being rare, with most economic activity happening on layers above the base. Most people never touching the underlying Bitcoin, just interacting with instruments build on top of it. That is exactly what STRC is. A credit layer on top of Bitcoin’s monetary base. And it raised $1.18 billion in a single week while private credit funds are literally shutting their gates to prevent people from leaving. The capital reallocation from legacy credit to digital credit is not a prediction game anymore. It is happening in real-time!

Standard Oil didn’t get big because oil was valuable. It got big because Rockefeller figured out that raw crude is useless until you refine it and build the plumbing to move it through the economy. That exact ‘Strategy’ is being executed right now.

There’s a version of the Bitcoin thesis that only makes sense in peacetime, where it’s just a better savings technology in a world that otherwise functions normally. That version is comfortable and clean and easy to explain at dinner. Then there’s the version you see right now. A war breaks out. Oil spikes. The bond market seizes. Gold rallies for a week and then stalls. And Bitcoin, the thing that every allocator said was too volatile, too speculative, too correlated to risk assets, quietly climbs 12% while the rest of the financial system tries to figure out what to do next. Meanwhile, people inside the war zone are using Bitcoin to move capital out of a collapsing system. Not because they read a white paper or watched a podcast or have a financial advisor. Because their banks are frozen, their currency is losing value by the day, and Bitcoin is the only network that doesn’t ask for permission. I think about this a lot when people ask me why I built an advisory practice around a single asset. The answer is that no other asset does what Bitcoin does when things actually break. Not gold. Not real estate. Not Treasuries. Nothing else settles globally, 24/7, without counterparty risk, under any political conditions. That matters more than volatility. It always has.

If private credit funds are gating withdrawals during a downturn, what exactly makes them safer than an asset that you can sell 24/7/365 on any exchange on earth?

Holding an asset whose supply cannot be manipulated by any government, corporation, or institution is probably the least risky thing you can do with long-duration capital.

But paper straws am I right? 📝 2e665266…

10% Bitcoin in a 60/40 portfolio over the last 5 years: Traditional 60/40: ~7% annualized 55/35/10 (with BTC): ~13% annualized This is not about being a Bitcoin maximalist. It is about reading the data. Your advisor should be able to have this conversation.

STRC is back at its $100 par. Bitcoin is still about 42.6% off its highs. Same ecosystem. Very different ride. STRC is Strategy’s perpetual preferred stock. It is built to trade around $100 par by adjusting its dividend rate monthly, specifically to encourage the par peg and reduce price volatility. It also pays cash dividends monthly (current stated annualized rate shown as 11.25%, variable). This is the point I keep making. Bitcoin exposure is not one product. It is a design space. Educational only. Not investment, tax, or legal advice. Dividends and trading price are not guaranteed and the rate can change materially.