Shutdown Stalls SEC’s Crypto Scrutiny as S&P Labels MicroStrategy B-: What’s Next for Bitcoin?

Get the latest analysis on SEC news, how the government shutdown impacts crypto investigations, and what public companies like MicroStrategy face next.

What’s Happening: SEC Puts Crypto Treasury Probe on Pause

The latest SEC news is making headlines: The U.S. Securities and Exchange Commission (SEC) has paused its high-profile investigation into how publicly traded companies use cryptocurrency in their treasuries. The reason? An ongoing U.S. government shutdown that has forced SEC staff into furlough, putting enforcement activities on hold.

Why Is the SEC Investigating Crypto Treasuries?

Over 200 public companies—including giants like MicroStrategy—have added crypto assets like Bitcoin, Ethereum, or Solana to their balance sheets. Some of these companies saw dramatic spikes in stock price and trading volume soon after announcing their crypto exposures. This caught the SEC’s attention, raising questions about possible insider trading and violations of Regulation FD (fair disclosure practices).

SEC investigators were ready to step up, issuing subpoenas and reviewing company records to ensure nobody unfairly benefited from these crypto announcements—until everything was frozen by the shutdown.

How the SEC Government Shutdown Affects Crypto Investigations

The SEC government shutdown means the agency is only running with a skeleton crew. Here’s what that means for ongoing and future investigations:

• No subpoenas, depositions, or enforcement actions: Casework grinds to a halt.

• Active cases on pause: Companies under scrutiny get temporary breathing room—but scrutiny resumes once operations restart.

• Investigators can only review and strategize: No new formal actions until the government reopens.

Takeaway: The pause is only temporary. Companies should still prepare for future SEC document requests or investigations into their crypto treasury announcements and trading patterns.

What to Expect: SEC Crypto Enforcement After the Shutdown

Once the SEC returns to full strength, expect a rapid resumption of this crypto treasury investigation:

• Priority targets: Companies whose public crypto buys aligned with big stock moves.

• Key evidence: Email trails, trading activity, and timing of public statements.

• Potential issues: Insider trading, market manipulation, and disclosure violations.

If your company or investment interests are tied to major crypto-treasury holders, stay alert for renewed SEC news in the months ahead.

S&P’s Junk Rating for MicroStrategy (Strategy Inc.): What It Means

S&P’s Surprising Credit Rating in Crypto News

Another headline in recent SEC and crypto news: S&P Global just issued its first credit rating for a crypto-heavy treasury company, giving MicroStrategy (now called Strategy Inc., NASDAQ: MSTR) a speculative-grade B- “junk” rating.

Why Did S&P Rate Strategy Inc. as “Junk”?

• Business is heavily concentrated in Bitcoin; nearly all assets are in crypto.

• Weak USD liquidity: Most cash gets converted to Bitcoin, leaving little in dollars.

• Risk-adjusted capital (RAC) is negative, due to how S&P excludes Bitcoin from equity calculations.

• S&P warns of a significant currency mismatch: debts and obligations are in U.S. dollars, while the main assets are in BTC.

S&P notes that Strategy’s Bitcoin strategy could put its ability to meet USD-denominated debt obligations at risk—especially if the crypto market suffers.

Despite these risks, company founder Michael Saylor publicly celebrated being the first digital asset treasury firm to receive a mainstream credit rating.

SEC News: Why This Matters for Crypto, Public Companies, and Investors

• Crypto exposure = scrutiny: As more companies buy BTC for their balance sheets, expect more news of SEC investigations and credit agency reviews.

• Regulation lags reality: Companies move quickly, but regulators play catch-up—especially during events like a government shutdown.

• Investor caution: Professional ratings (e.g., S&P’s junk grade) and SEC actions can directly impact stock prices and market trust.