Michael Saylor pitches Strategy's Bitcoin credit model to Trump’s FHFA Director

Key Takeaways

• Michael Saylor proposed sharing MicroStrategy's Bitcoin Credit Model with the Trump administration's housing director.
• The initiative aims to develop Bitcoin-backed mortgages by integrating Bitcoin into traditional housing finance.

Strategy Executive Chairman Michael Saylor offered to share his company’s BTC Credit model with Bill Pulte, the US Director of the Federal Housing Finance Agency (FHFA), as Pulte expressed interest in exploring how crypto could factor into mortgage eligibility.

Strategy has been recognized for its highly leveraged approach to accumulating Bitcoin, utilizing debt financing primarily through convertible notes and bonds to purchase and hold substantial amounts of Bitcoin as a treasury asset.

Strategy’s BTC Credit model is a Bitcoin-native framework developed by the Tyson-based company to assess the creditworthiness of its debt and preferred stock based on its Bitcoin holdings.

Instead of relying on traditional financial ratios, the model evaluates how many times Strategy’s BTC reserves cover its liabilities (BTC Rating), the associated credit risk based on volatility (BTC Risk), and a theoretical credit spread (BTC Credit).

The Saylor-led company continually raises capital at low interest rates, betting that Bitcoin’s long-term appreciation will outpace the cost of borrowing. Yesterday, the firm disclosed it had acquired 245 BTC for $26 million last week.

Strategy currently holds 592,345 BTC, valued at over $62 billion, with more than $20 billion in unrealized gains as Bitcoin trades above $105,000.

Pulte’s initiative would represent an effort to integrate Bitcoin into traditional housing finance mechanisms under the new administration’s housing policy framework.