Private credit's golden era was built on a simple promise: higher yield, lower volatility, and insulation from public markets. But that era is coming to an end, and a new era appears to be around the corner. 

The $2 trillion asset class still reports through quarterly NAV statements that lag reality by 45 to 90 days. Its marks are manager-determined, with capital often locked for years or gated when investors most want liquidity. It’s reported yields increasingly include payment-in-kind income, where borrowers pay non-cash interest by issuing more debt. Fund structures often consume 200 to 400 basis points of gross returns before a limited partner receives a dollar. Private credit is also inaccessible to roughly 87% of American investors due to accreditation barriers. The 2024 to 2025 cycle, anchored by the Pluralsight restructuring and the late-2025 redemption wave, exposed structural weaknesses that institutional allocators had under-priced for a decade.

There is now a structurally superior alternative for yield-seeking investors: digital credit. Its first proof points are Strategy's STRC and Strive's SATA, publicly traded perpetual preferred stocks that yield 11.5% and 13.0%, respectively. These dividends are paid monthly in cash, with STRC expected to move to twice monthly and SATA to daily distributions. On transparency, the issuers publish standard SEC 10-K and 10-Q reports and provide weekly updates on their treasury balances on their respective websites. Access is also better than for private credit: STRC and SATA trade daily on NASDAQ with real-time pricing, carry no fund-level fees, and require no accreditation to purchase. On a combined basis, the two instruments clear north of $350 million in daily trading volume. A retail investor with $100 can hold the same instrument that institutional allocators access at scale, on the same terms, with the same disclosure.

The standard objection to digital credit is that double-digit yields must imply CCC-like credit risk. Grayscale, for example, classified STRC as a risky yield-bearing instrument simply because it offers yields comparable to CCC corporate bonds. This is a faulty conclusion, as standard credit risk frameworks materially overstate the risks that STRC and SATA carry. CCC borrowers are typically distressed operating companies servicing debt from cash flows. Strategy and Strive are balance-sheet vehicles holding a single liquid reserve asset against perpetual, non-amortizing preferred obligations. A more appropriate analytical framework for assessing the risk of these instruments would be something akin to reserve-based lending. Under that lens, current yields compensate for clearly bounded structural risks rather than indeterminate default risk. The risk framework is far simpler: whether bitcoin reserve value, over the next five to ten years, is sufficient to support the preferred stack.  

This report argues that digital credit may offer a structurally superior framework for yield-seeking investors than much of the modern private credit market. To make that case, it examines how private credit actually functions beneath the surface, including the growing role of PIK income, valuation lag, fees, and redemption constraints that can make reported yields and volatility appear more attractive than they truly are. It also explores how digital credit instruments like STRC and SATA are structured, why traditional CCC-style credit frameworks may mischaracterize their risks, and how the category compares to private credit across yield, transparency, liquidity, accessibility, and risk visibility. The goal is not to argue that private credit is broken or that digital credit is risk-free, but rather to examine whether investors still need to accept opacity, illiquidity, and high fee structures to access high yield in a world where transparent, publicly traded alternatives now exist.

The Private Credit Problem

Private credit's reputation rests on three key pillars, each of which deserves greater scrutiny: 

1. Low default rates

2. Smooth-looking NAV histories

3. Yields that comfortably exceed public credit. 

The historically low default rates in private credit are partly a function of how defaults get reported. For example, borrowers often avoid formal payment default by renegotiating terms with lenders. Morningstar DBRS found that these cases accounted for roughly 94% of private-credit downgrades to default or selective default in the 12 months through February 2026, and Fitch attributed about 60% of defaults in the year through January 2026 to interest deferrals and PIK in lieu of cash. Each mechanism conserves the borrower's liquidity and keeps the headline default count low while the underlying credit deteriorates. In plain terms, many borrowers are no longer paying cash and are simply buying time. Even by reported measures, defaults are climbing. For example, Fitch's U.S. Private Credit Default Rate reached a record 6.0% on a trailing-12-month basis in April 2026

On NAVs, private credit appears smoother than public credit because it is not priced every day. It is marked quarterly, often with a 45-90-day delay, under valuation processes that leave meaningful discretion to the manager. However, this does not actually make the assets less volatile; it simply makes the volatility slower to appear.

Lastly, private credit yields are often quoted gross, before management fees, incentive fees, and fund expenses. Increasingly, a portion of that yield also comes from payment-in-kind (“PIK”) income rather than cash. So the number shown on the page can differ meaningfully from what a limited partner actually receives.

In essence, private credit does not eliminate risk; it simply packages risk in a structure that makes it harder to see.

What Private Credit Actually Is

The term “private credit” is used loosely enough that the definition is worth stating plainly: private credit is simply lending outside the banking system. A company borrows from a private fund instead of a bank or the public bond market. The loan is originated privately, held privately, and valued privately. It does not trade on an exchange, and there is no daily market price. Instead, the manager marks the loan quarterly at its estimate of fair value.

This market grew after 2008, when regulated banks pulled back from parts of corporate lending and private funds stepped in to take their place. The typical borrower is a private-equity-owned company, the lender is usually an asset manager, and the typical investor is usually an institution seeking yield above public credit.

Private credit is often treated as one asset class, but it is really a collection of strategies with different risks, liquidity profiles, and sources of return. A February 2026 benchmarking study by Joenvaara and Suhonen, which analyzed private credit indexes from MSIC, Pitchbook, and Preqin from 2001 to 2024, found that the sub-classes differ enough that the broad private credit averages can be misleading⁶

The major sub-categories are: 

• Senior secured direct lending: First-lien, floating-rate loans to middle-market companies, usually backed by private equity sponsors. This is the largest and historically strongest-performing segment of private credit.

• Subordinated and mezzanine debt: Junior claims that often include equity warrants alongside cash coupons. Higher yields come with materially higher risk and embedded equity exposure.

• Distressed and opportunistic: Special situations and distressed debt strategies that can generate high returns, but also carry significantly higher systematic risk⁷

• Asset-backed and specialty finance: Lending against receivables, equipment, royalties, and other cash-flowing assets. A fast-growing but historically weaker segment on a risk-adjusted basis.

• Real estate debt and niche strategies: Property lending, litigation finance, royalty finance, and other specialized credit strategies. These are diverse, idiosyncratic, and difficult to benchmark cleanly

A meaningful part of private credit is private equity risk inside a credit wrapper. MSCI's April 2026 asset-level analysis found that roughly a quarter of private-credit fund fair value sits in equity, warrants, convertibles, and other non-debt securities rather than in loans⁸ benchmark study reached a similar conclusion from the return side, estimating that about 20% of private-credit portfolios by value hold equity-like instruments. "Private credit" is, in meaningful part, private equity wearing a credit costume. While this distinction can be easy to miss at the fund level, it is the difference between owning a loan and owning something that behaves like a loan until distress reveals embedded equity exposure.

Where The Yields Actually Come From

A private credit fund quoting a 10% to 12% gross yield does not deliver 10% to 12% to the limited partner. Three things reduce the quality of the stated yield: PIK income, fees, and weak origination terms

Payment In Kind (“PIK”)

PIK income is interest paid with additional debt rather than cash. While the Cliffwater Direct Lending Index reported PIK at just 0.7% of assets, or 7.3% of total income in 2025⁹ , the averages mask where the risk is concentrated. PIK usage tends to cluster in stressed, technology-heavy funds where credit deterioration is most likely. For example, Blue Owl’s Technology Finance Corp. reported PIK income at roughly 13% of total investment income in Q1 2026.¹⁰ When a meaningful share of yield comes from additional debt instead of cash, realized cash returns can fall well below headline figures, particularly in the segments under the greatest stress.

Fees

Fees create the second compression. Traditional private credit funds charge management fees of 1.25% to 1.75% on committed or invested capital plus performance fees of 15% to 20%¹¹ and 6-7% hurdle¹² . Business development companies operate under similar economics, with SEC filings often showing 1.5 percent management plus 17.5 to 20 percent incentive fees on net investment income. On a 10 percent gross yield, the LP typically nets 7 to 8 percent after fees. On a 12 percent gross yield, the LP typically nets 9 to 10 percent. In sharp contrast, STRC and SATA carry no fund-level fees. The dividend declared is the dividend received.

Origination Quality

The third yield compression factor is less visible but still important to highlight. Spreads compressed steadily from 2021 through 2024. Direct lending spreads tightened to roughly SOFR plus 525 basis points by late 2024, down from SOFR plus 700 and more during the 2020 to 2021 deployment window¹³ . Cov protections weakened in parallel. This means some of the strongest stated yields in the market come from older loans written on better terms¹⁴ . New loans often carry lower spreads, weaker protections, and less margin for error. The historical yield of the asset class can therefore overstate the quality of what investors are buying today.

What You Can’t See

Private credit is not priced daily. Private credit funds typically report quarterly, with a 45-day lag and up to 90 days at fiscal year-end. Marks are determined by the manager within a fair value framework. Independent valuation agents and audit committees may review the process, but discretion remains. There is no daily market price forcing recognition.

MSCI's asset-level work makes this problem more concrete. Manager-reported marks for information-technology loans through the end of 2025 did not yet reflect the early-2026 repricing that had already hit listed software-exposed credit vehicles, because drawdown funds report on a delay. In plain English, an investor holding a software-heavy private credit fund in early 2026 was reading marks from before the market had fully absorbed any bad news.

Pluralsight is a clean case study in this problem. Vista Equity Partners acquired the company in 2021 for $3.5 billion. Through 2022, 2023, and the first quarter of 2024, Vista carried the equity at full or near-full value on its fund statements. Then, in May 2024, Vista wrote its $1.6 billion equity investment to zero in a single quarter. By August, the lender group owned the company. While the economic impairment had developed over the years, the reporting only captured it in one quarter. This is one of the core issues with private credit marks: they only reveal stress when the underlying structure can no longer defer recognition.

Why You Can’t Leave

Closed-end private credit funds lock capital for 7 to 10 years with no redemption rights. Semi-liquid structures, including business development companies and interval funds, offer quarterly redemption capped at 5% of NAV. The cap is a hard limit. When investors collectively request more than 5% in a quarter, redemptions get prorated, queued, or gated.

The 2025 to 2026 redemption wave demonstrated this dynamic. In Q1 2026, investors across the non-traded BDC landscape requested $13.9 billion in redemptions, while sponsors only honored $7.4 billion, per Robert A. Stanger & Co.

Blue Owl's $6.2 billion technology-focused OTIC fund was the sharpest case: redemption requests reached 15.4% of NAV in Q4 2025 and 40.7% in Q1 2026, far beyond what the 5% gate could honor. This is the practical meaning of semi-liquid: an investor who read the software-sector stress correctly and asked for their capital back only received a fraction of it. In other words, the exit door is there, but it quickly shrinks when everyone tries to sprint through it. 

Who Can Participate

Private credit is also gated by design. Most private credit funds are available only to accredited investors or qualified purchasers. Accredited investors generally must have at least $200,000 of annual income, or $1 million of net worth excluding their primary residence. Qualified purchasers generally must have at least $5 million in investments. These rules exclude most households; by the SEC’s own estimate, roughly 87% of American households do not qualify as accredited investors.

Minimum investment thresholds further narrow the door. Traditional private credit funds often require $1 million or more. Non-traded BDCs may be lower, often around $10,000, but they still sit inside semi-liquid structures with redemption limits. The result is an asset class built primarily for institutions. Roughly 80% of private credit AUM is institutional.

The default numbers in circulation differ because the measures differ, but the gap is worth understanding. The Proskauer rate above tracks payment defaults across roughly 800 to 900 loans the firm advises on. Fitch publishes two: its Privately Monitored Ratings (PMR) rate, covering about 300 larger sponsor-backed borrowers, hit 9.4% in January 2026, while its broader Private Credit Default Rate (PCDR), spanning roughly 1,200 middle-market borrowers, reached 6.0% on a trailing-twelve-month basis in April 2026. All three are issuer-count measures, and all three point in the same direction: default rates trending up. Covenant defaults reached 3.2% as of September 2025. Senior secured first-lien loans historically recover 65% to 75% of principal, but $25 billion of software-sector loans now trade below 80 cents, the conventional distress threshold, and roughly 13% of software loans in leveraged loan indices sit at distressed levels. 

The Strongest Case for Private Credit, and Why It Does Not Change the Conclusion

The strongest case for private credit is simply that parts of the asset class have worked.

Cliffwater's Direct Lending Index returned 9.33% in 2025, with realized losses of just 0.70%, below its long-run average of 1.01%. Across two decades, the index has averaged roughly 9.5% with only one negative year: a 6.5% decline in 2008. Its income yield of about 9.9% sits nearly three points above broadly syndicated loans, a premium Cliffwater attributes to illiquidity. The Joenvaara and Suhonen benchmarking study found that direct lending, the dominant segment of private credit, produced a genuine risk-adjusted alpha of roughly 3.8% per year even after pricing both credit and equity risk. And Cliffwater notes that historically, deep discounts in publicly traded BDC prices have preceded strong forward returns rather than losses: a 17% discount during the 2011 euro crisis was followed by a 14.2% one-year private-debt return, and a 50% discount during COVID by 14.4%.

All this to say: private credit is not a fraud, direct lending is not a bubble, and the best-performing sub-categories of private credit have earned their place. But for an investor seeking high yield, private credit delivers that yield inside a fee-bearing, lock-up-bound, quarterly-marked, accreditation-gated wrapper. Despite the clickbait headlines, the case against private credit isn’t that it loses money. It is what makes an investor accept opacity, illiquidity, and fees to earn a yield now available in a transparent, liquid, fee-free form.

Digital Credit: A New Financial Primitive

Digital credit refers to a new category of publicly traded preferred securities issued by Bitcoin treasury companies. The term is not meant to suggest that these instruments are traditional debt. 

“Digital credit” is the category name Strategy uses in its SEC filings, and it is useful for one key reason: these securities compete for the same investor need that private credit has historically served. They offer high cash yield, structured downside protection, a framework for underwriting risk through asset coverage rather than operating cash flow, and sit between debt and common equity in the capital stack.

Two issuers anchor the category. Strategy Inc. (NASDAQ: MSTR) issues five preferred series: STRF, STRC, STRE, STRK, and STRD, while Strive Inc. (NASDAQ: ASST) issues one: SATA. Both STRC and SATA are variable-rate instruments designed to trade near $100 par and share several structural features. Both are perpetual preferred equity rather than debt, pay cumulative variable-rate dividends set to anchor the share price near par, are non-convertible, and unsecured. To truly understand the new primitive that is digital credit, it’s worth honing in on STRC and SATA.

STRC: The Digital Credit Crown Jewel

Strategy is the world’s largest Bitcoin treasury company, with 843,738 BTC, as of May 2026. STRC was priced at $90 on July 24, 2025, and began trading on NASDAQ shortly thereafter. As of May 25, 2026, the instrument had approximately 105 million shares outstanding, up from roughly 28 million at issuance, for a notional value of approximately $10.5 billion. 

In a liquidation scenario, roughly $22 billion in senior claims would sit ahead of common equity. For STRC specifically, roughly $8B in senior claims sit ahead of it.

Why CCC Credit Comparables Miss the Mark

The most common mistake is to compare STRC’s yield to CCC corporate credit and assume the risk must be similar.

CCC corporate credits are typically distressed operating companies, as they service debt from operating cash flow. The key question is whether that cash flow can support interest expense, debt maturities, and the business itself. Recovery analysis turns on enterprise value, asset sales, refinancing access, and whether the company remains viable as a going concern. Strategy, by contrast, is a balance-sheet vehicle. As of May 27, it sits on roughly $62B of BTC and $871M of cash. This is why reserve-based lending is the better analytical frame. Strategy’s preferred dividend obligations can be tested against the market value of its Bitcoin holdings under stress.

On asset coverage, the cushion is substantial. As of May 27, Bitcoin would need to fall by more than 66% before Strategy’s assets fell below its liabilities plus preferred notional. Dividend coverage is also substantial. Assuming all of Strategy’s cash was fully depleted, Bitcoin could fall roughly 95% to approximately $4,200, and Strategy’s Bitcoin treasury alone would still provide two years of additional dividend and interest coverage.

That would obviously be a severe stress scenario. But that’s the point: the credit risk can be clearly modeled and stress tested as a function of BTC price. This is not the same as underwriting whether a distressed operating company can survive another quarter. 

So What’s The Risk?

The first risk is legal structure, as STRC is not collateralized by Strategy’s Bitcoin, meaning the preferred holders do not have a direct lien on the BTC. This means the asset coverage is economic instead of contractual. STRC holders have a preferred claim on residual assets, not a secured claim on a specific pool of BTC collateral.

Access to capital markets is also a risk. Strategy’s model works best when its common equity trades at a premium to NAV (“mNAV”), allowing it to issue equity in a way that is accretive to Bitcoin per share and supportive of preferred dividends. If that premium disappears for a sustained period, the company loses its cleanest source of funding.

Lastly, the biggest risk is that Bitcoin does not appreciate fast enough to support an 11.5% preferred coupon in perpetuity. Because STRC has no maturity date, the dividend obligation is perpetual. If Bitcoin compounds faster than the dividend burden, the structure works. If Bitcoin stagnates, declines, or compounds too slowly, Strategy must rely on cash, equity issuance, refinancing, dividend deferral or reduction, or, in the worst case, bitcoin sales. In other words, the key question when assessing STRC’s risk is whether Strategy’s Bitcoin reserve value can grow fast enough over time to support the preferred stack.

While these risks are real, they’re also visible. Investors can track Strategy’s BTC balance, preferred obligations, mNAV, and the preferred market price in real time. There is no risk that is hidden or obscured by structure. It is priced every day.

SATA: Higher Yield, Daily Dividend

SATA (Strive’s Variable Rate Series A Perpetual Preferred Stock) is the higher-yielding instrument in the digital credit category. It IPO’d in November 2025 at $80 per share and its initial offering was upsized from 1.25 million to 2 million shares.

On May 14, 2026, Strive announced that SATA would become the first U.S.-listed security to pay cash dividends every business day, effective June 16, 2026. The shift from monthly to daily payment does not change the stated dividend rate, but it materially changes the investor experience. For example, because cash arrives faster, reinvestment can happen more frequently. The effective yield also rises through compounding, to roughly 13.6 to 13.9% depending on price and reinvestment assumptions.

Reserve Coverage

SATA has a different risk profile from STRC because Strive’s capital structure is simpler.

Strive reports holdings of approximately 16,500 BTC, along with cash and a position in Strategy’s STRC, per its investor dashboard. More importantly, SATA sits at the top of Strive’s capital structure. There is no senior debt above it. 

At different Bitcoin prices, Strive’s reserve base translates into the following static coverage of preferred dividend obligations:

These figures assume linear depletion of the reserve to fund preferreds. At current BTC prices, Strive has 16.3 years of dividend coverage.

The DGCR ETF

On March 30, 2026, Strive Asset Management and Tuttle Capital Management filed for the T-Strive Digital Credit ETF on Cboe. The fund would seek income through STRC and SATA, with leverage primarily through total return swaps on SATA. The registration statement has been filed but is not yet effective.

If approved, DGCR would package the two anchor instruments into a single income ETF, broadening access to the category beyond single-name preferred buyers. It would also add concentration. Strive already holds STRC. DGCR would hold both STRC and SATA, with swap-based leverage adding another layer of exposure to the same ecosystem.

Side-by-Side Comparison

Before continuing, it should be noted that private credit is a $2 to $3 trillion diversified asset class spread across thousands of borrowers, hundreds of managers, and a dozen segments. Digital credit is fairly nascent, with two preferred stocks from two issuers with correlated underlying exposure to BTC. The question investors should ask is what each structure offers in exchange for the risk: cash yield, transparency, liquidity, fees, access, and the ability to respond when conditions change.

Yield Comparison

Once fees and PIK adjustments are applied, digital credit's headline yields exceed all but the most aggressive private credit segments on a like-for-like cash basis. A digital credit investor gets more cash with less leakage.

Transparency

Digital credit issuers like Strategy and Strive publish SEC 10-K and 10-Q filings, real-time NASDAQ pricing, daily Bitcoin holdings, and full capital structure disclosure. Private credit publishes quarterly NAV statements with a 45 to 90-day lag, manager letters, and aggregated portfolio metrics. Digital credit investors experience volatility in real time. Private credit investors experience it on a delay, after the manager has finished marking. For an allocator, the practical difference is when bad news gets priced. In digital credit, the market does it continuously, and an investor can respond. In private credit, the manager does it quarterly, and the investor only finds out after the fact.

Liquidity

Digital credit's daily liquidity advantage is real. A digital credit investor who wants to exit on a bad day can. A private credit investor who wants to exit on a bad day simply can’t.

Access

Gated access to private credit not only shuts retail out but also makes the asset class more reflexive when the gated audience moves the same way, as the 2025 to 2026 redemption wave demonstrated. A broader, more diverse buyer base, as the one digital credit attracts, supports liquidity and lowers the issuer's cost of capital, feeding back into the sustainability of the dividend itself.

Risk Profile

Private credit's risks are diversified, but hidden and lagged. In contrast, digital credit's risks are concentrated, but visible and continuous. Rather than asking which category carries more risk in aggregate, the better question is which structure lets the investor see and respond to risks in real-time. On that test, digital credit wins.

Implications for Institutional Investors

Where Each Fits

Private credit still fits certain mandates. It makes sense for long-duration institutions with explicit private credit allocations, tolerance for illiquidity, and access to managers who have proven they can underwrite through a full cycle. Within the asset class, however, allocators should be selective. The evidence points most clearly to senior direct lending, where alpha is real and statistically robust. On the other hand, opportunistic and asset-backed strategies have not earned the same risk-adjusted returns in the historical data.

Digital credit fits a broader audience. It may be relevant to investors with or without an existing digital asset allocation, and with or without accredited status. It does not require a multi-year lockup or a private fund subscription. It does not require accepting manager-determined quarterly marks. 

Risks to Monitor

Both categories carry real risks, and an honest comparison requires naming them. The list below is not a ranking of severity but a working watchlist. They are the variables that, if they move the wrong way, would shift the calculus for either asset class.

Digital Credit

• Bitcoin price correlation in correlated stress, including across STRC, SATA, and Bitcoin simultaneously

• Capital markets access. The variable-rate dividend mechanism depends on it

• Structural performance of perpetual variable-rate preferreds in a Bitcoin bear market. No precedent

• Reflexive exposure inside the category: Strive holding STRC, DGCR holding both

• Regulatory treatment of Bitcoin treasury companies and their preferred securities

Private Credit

• PIK accrual growth as a share of stated income, concentrated in stressed and tech-heavy funds

• Valuation lag in stressed positions, particularly software-sector exposures

• Redemption gate triggering across semi-liquid vehicles

• Hidden equity beta and the gap between reported and de-smoothed volatility

• Sponsor concentration across multiple manager portfolios

Due Diligence Frameworks

Different structures demand different questions. For digital credit, due diligence is largely an exercise in reserve mechanics and capital markets access. For private credit, it is an exercise in seeing through fund-level reporting to the underlying portfolio and the fee load that sits on top of it. The questions below are the ones an allocator should be able to answer before sizing a position in either.

Digital Credit

• Reserve coverage ratios across multiple Bitcoin price scenarios. Use dynamic, not static, framing

• Capital structure seniority and the specific position within the issuer's preferred stack

• Dividend sustainability under stressed capital market access

• Management credibility and access to multiple funding channels

• Tax treatment, particularly the return-of-capital classification of current distributions

Private credit

• Sub-strategy mix. Direct lending earns alpha; opportunistic and asset-backed historically do not

• PIK income as a percentage of stated portfolio income across multiple quarters

• Fee structure, including management fee, incentive fee, hurdle rate, and high water mark

• Net-of-fee historical returns versus gross stated yields, with a leveraged-loan-plus-equity benchmark

• Valuation policies, third-party oversight, and the timing of the most recent significant markdown

• Redemption terms in stress, including gate-triggering thresholds and historical use

Conclusion

Private credit is not entirely broken. Sectors like direct lending still earn real, defensible returns. But the structure asks a lot of investors. It asks them to accept opacity, illiquidity, fund-level fees, and limited exits for a yield that is now available elsewhere in cash, daily-liquid, and fee-free form.

Assessed through the lens of reserve-based lending rather than corporate credit, digital credit’s risks are much easier to define. Single-asset concentration and capital markets dependency are real risks, but they are not the same as the indeterminate default risk of a CCC borrower whose operating business is under distress. The yield is comparable, but the quality of that yield is higher given BTC’s long-term outperformance.

Can private credit still deliver? Yes, and in many cases it does. But the question is whether the structure deserves the premium it’s historically been given. 

With digital credit on the menu, we are not convinced it does.

In service of SPS growth,
DeFi Development Corp.

1  _{Estimates of total private-credit AUM range from roughly $2 trillion (Alternative Credit Council) to about $3 trillion (MSCI), depending on methodology and which vehicles are counted.}

2  _{Per the SEC, approximately 12.6% of U.S. households qualified as accredited investors as of 2025, leaving roughly 87% excluded.}

3  _{Combined daily trading volume of STRC and SATA. STRC alone averages roughly $340 million per day per Strategy's STRC dashboard (strategy.com/strc) as of May 2026.}

4  _{Grayscale Investments, "No Need to Stretch for Bitcoin Exposure" (2026). https://www.grayscale.com/the-stack/no-need-to-stretch-for-bitcoin-exposure}

5  _{Fitch Ratings, U.S. Private Credit Default Rate (PCDR), reached 6.0% on a trailing-twelve-month basis in April 2026, a record since the index's August 2024 inception.}

6  _{Juha Joenvaara and Antti Suhonen, "Benchmarking Private Credit" (February 2026), analyzing MSCI, PitchBook, and Preqin private-credit indexes over 2001 to 2024. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6178638}

7  _{Juha Joenvaara and Antti Suhonen, "Benchmarking Private Credit" (February 2026), analyzing MSCI, PitchBook, and Preqin private-credit indexes over 2001 to 2024. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6178638} 

8  _{MSCI, "Private Credit Unwrapped: The Asset-Level View on Performance" (April 30, 2026). Asset-level figures are gross of fund fees and fund-level leverage.}

9  _{Cliffwater LLC, "New Private Credit Data Contradicts the Recent Risk Narrative" (February 23, 2026); Cliffwater Direct Lending Index 2025 calendar-year results.}

10  _{Blue Owl Technology Finance Corp. (NYSE: OTF) Q1 2026 earnings call; PIK income of approximately 13% of total investment income (7.6% PIK interest, 5.4% PIK dividends), described by management as down roughly half from prior peak levels.}

11   _{https://www.sec.gov/Archives/edgar/data/1747777/000119312525134115/d935741dex993.htm} 

12   _iCapital 

13  _{Strategy estimates all-in direct-lending yields near 8.4%; the Cliffwater Direct Lending Index reported an income yield of roughly 9.3% for 2025.}

14   _{J.P. Morgan Private Bank, "Four reasons to consider private credit despite the headlines," notes particular concern about the 2021/2022 loan vintage, underwritten at higher leverage and on the basis of lower-rate expectations. https://privatebank.jpmorgan.com/nam/en/insights/markets-and-investing/ideas-and-insights/four-reasons-to-consider-private-credit-despite-the-headlines} 

_{Disclaimer: This is for informational purposes only and reflects publicly announced developments, milestones, and media coverage related to DeFi Development Corp. (“the Company”). The information contained herein does not constitute an offer to sell or a solicitation of an offer to buy any securities, nor should it be relied upon as investment advice or a recommendation regarding any securities. Certain statements in this post may constitute “forward-looking statements” within the meaning of applicable securities laws. These statements are based on current expectations and assumptions and involve risks and uncertainties that could cause actual results or events to differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of publication. DeFi Development Corp. undertakes no obligation to update any forward-looking statements, except as required by law. All information is accurate as of the date posted and is subject to change without notice.}