Dan Hillery: Digital Credit Market Reaches 16 Billion USD, Could Rival Bitcoin's 1.5 Trillion USD Cap

Bitcoin-backed digital credit has grown to approximately 16 billion USD, with Dan Hillery of UXTO suggesting that its financialization layer could eventually rival Bitcoin itself. In the first episode of The Allocators Edge, Hillery discusses the pricing of variable-rate preferred securities like STRC and SATA, the impact of buybacks on their stability near 100 USD par, and the differences between digital credit risk and digital equity risk. He outlines the structured credit fund he is developing, detailing its senior and junior tranches. Key topics include the rapid growth of digital credit within Bitcoin's capital structure, the unique variable rate design of STRC, implications of Bitcoin price fluctuations on investment strategies, and misconceptions about preferred securities. Hillery also addresses the current limitations faced by major fund classes in accessing digital credit and explains the leverage sources and volatility risk management in his fund.

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