MicroStrategy, already the largest corporate holder of Bitcoin, is doubling down on its crypto investment strategy. The company revealed plans to raise $700 million through a private sale of convertible senior notes, intending to buy even more Bitcoin.
The proceeds from this offering will primarily be used to redeem $500 million in previous senior secured notes due in 2028, which, including interest, will cost around $523.8 million. MicroStrategy intends to use any remaining funds to purchase additional Bitcoin and for general corporate needs.
Senior notes are a debt instrument issued to investors, and convertible notes offer the option to convert the debt into company equity. MicroStrategy has been issuing these notes to fund its aggressive Bitcoin acquisition strategy.
As of the latest purchase, the company holds 244,800 Bitcoin, valued at approximately $14.2 billion. Currently, Bitcoin is trading at around $57,661, significantly down from its all-time high of $73,737 in March.
MicroStrategy began its Bitcoin buying spree in 2020, with Michael Saylor, the former CEO and now Chairman, championing the strategy as the best way to preserve wealth and maximize shareholder returns. The company’s stock (Nasdaq: MSTR) has surged over 800% since it began incorporating Bitcoin into its balance sheet, and its total Bitcoin holdings are now worth about 50% more than what it paid.
Saylor has emphasized the company’s commitment to a “buy and hold” strategy for Bitcoin, aiming to remain consistent, transparent, and responsible in its pursuit of cryptocurrency dominance.