The New Regime | True North Podcast | Ep. 68

— Strategy's balance sheet has strengthened dramatically since November 2022, with leverage ratios improving from 130% to 9.2%, despite issuing preferred stock and dividend obligations totaling $1.7 billion annually (34 years of coverage).

— The company retired $1.5 billion of convertible debt using cash reserves, eliminating the highest conversion-priced converts and improving seniority of preferred equity by removing senior claims.

— Bitcoin price would need to fall 89% (to $7,957) for assets to fall below debt; a 50% decline would still leave 16 years of dividend coverage, far healthier than the 2022 bear market scenario.

— The AI memory bottleneck (HBM, DRAM, NAND) is the current constraint, not GPU compute, with Micron Technology 10x-ing in one year as the primary US manufacturer of these chips.

— US federal debt ($38.5 trillion) now outpaces nominal GDP ($31.9 trillion) and compounds at 3.7% annually; federal interest payments ($1.2 trillion) equal defense spending, pressuring the Fed's policy options under new chair Warsh.

— Digital credit products provide a free market-priced interest rate backed by Bitcoin collateral, unlocking capital preservation demand amid macro uncertainty and potential reserve currency erosion.

— Strategy's balance sheet stress-test confirms sustainability even in severe downturns; focus on Bitcoin-per-share as the key North Star metric, as debt retirement eliminates dilution and improves credit quality for preferred equity holders.

— Digital credit products (STRC, SEDA, STRK, STRF) remain attractive for capital preservation in a rising or falling rate environment, given robust over-collateralization and dividend sustainability; monitor STRC one-month VWAP at $99 threshold for dividend adjustments.

— Avoid chasing AI sentiment trades; if already positioned, secure profits. Bitcoin and digital credit represent a decade-long structural shift in monetary system adoption, not a cyclical trade, with total addressable market being the entire monetary system itself.