CoinDesk
Strive's risk chief pushed back on the read that last week's digital credit selloff was a credit event, framing it instead as a leverage-driven liquidation that the underlying market absorbed cleanly. Strategy's preferred-stock funding vehicle STRC slid as low as $82.53 on Thursday before rebounding to about $90.50, while Strive's SATA fell into the low $90 range and recovered to roughly $98.59, according to Chief Risk Officer Jeff Walton on CoinDesk's Public Keys.
The trading tape told the story Strive wants to tell. STRC alone moved about $950 million in volume on Thursday and SATA added roughly $150 million, figures Walton used to benchmark the session against BlackRock's $77 million PFF preferred-securities ETF. CEO Matt Cole had already called the episode a leverage liquidation event rather than a credit failure, a framing Walton echoed in pointing to forced selling that did not appear to originate in DeFi protocols.
Why it matters
The episode is the first stress test for a corner of the crypto credit stack that institutions have only recently been able to access through exchange-listed instruments. Walton's argument is that the bid was deep enough to clear a forced unwind without breaking the price-discovery mechanism, which is exactly the property an institutional allocator needs before sizing up. He also pointed to Strategy's balance sheet as a check on the credit thesis: roughly 10% leverage today versus about 130% during the 2022 bitcoin bear market.
Market impact
Strive is positioning the volatility as maturation, not breakage. Walton said holders rotated between SATA and STRC as yields converged, and he expects prices to gravitate back toward $100 as participants learn the instruments. The bigger pitch is structural: Strive argues digital credit can ultimately address a credit market worth roughly $300 trillion, and last Thursday's tape, painful as it was, is the evidence the plumbing can carry institutional size.
Frequently asked questions
-
What happened to STRC and SATA during the selloff?
STRC fell as low as $82.53 on Thursday before rebounding to about $90.50, and SATA dropped into the low $90 range before recovering to roughly $98.59, according to Strive CRO Jeff Walton.
-
Why does Strive say the selloff was not a credit crisis?
Strive CEO Matt Cole and CRO Jeff Walton characterized the move as a leverage liquidation event driven by forced selling and heavy trading pressure, not a deterioration in underlying credit quality or a DeFi protocol failure.
-
How much volume did STRC and SATA trade during the selloff?
STRC traded roughly $950 million in volume on Thursday and SATA added approximately $150 million. Walton contrasted those figures with BlackRock's PFF preferred-securities ETF, which he said traded about $77 million the same day.
-
How leveraged is Strategy's balance sheet compared to the 2022 cycle?
Walton said Strategy currently carries roughly 10% leverage, compared with approximately 130% leverage during the 2022 bitcoin bear market, arguing the credit thesis is structurally stronger now.
-
What is Strive's longer-term thesis for digital credit?
Strive believes digital credit instruments like STRC and SATA can ultimately address a credit market worth roughly $300 trillion, and expects prices to gravitate back toward $100 as market participants learn the products.
CryptoSlate
WatcherGuru
Glassnode
CoinTelegraph
Whale Alert
WuBlockchain
Crypto News