Breaking: MicroStrategy Set to Raise Additional $500M to Buy More Bitcoin

MicroStrategy unveils a $500 million fundraising initiative to bolster its Bitcoin acquisition drive, showcasing unwavering commitment to the flagship cryptocurrency. Renowned for its robust Bitcoin strategy, MicroStrategy Inc. stands out on Wall Street with ambitious plans to expand its substantial Bitcoin holdings.

MicroStrategy Inc’s Bitcoin Holdings Top 250,000 Units

Only two days after acquiring another 12,000 Bitcoin units for close to $822 million, MicroStrategy is now looking to raise $500 million to make an additional purchase. MicroStrategy also plans to fulfill some general corporate obligations with secured funds.

As of March 10, the company had a total of 205,000 Bitcoin units, acquired for approximately $6.91 billion with each Bitcoin having an average price of $33,706. The last purchase was made using proceeds from convertible notes and excess cash. The acquisition of 12,000 BTC comes after a prior purchase of 3,000 Bitcoin.

According to a published statement, MicroStrategy is once again offering Convertible Senior Notes, which would be due in 2031, in a private offering to sustain its Bitcoin strategy. Only qualified institutional buyers would be allowed to take part in the transaction. It is worth acknowledging that the offering is subject to market conditions amongst others. 

Therefore, no assurance can be offered as to when, whether or what terms the offering would be completed. 

Terms of the Convertible Senior Notes Offering

In the long run, the senior notes will be convertible into either cash, shares of MicroStrategy’s class A common stock, or a combination of cash and shares of MicroStrategy’s class A common stock, but all at MicroStrategy’s election.

Until September 15, 2028, holders of the convertible senior notes will hold the right to require MicroStrategy to repurchase for cash all or any portion of their notes. Before the aforementioned date, the notes will only be convertible in the case of certain events and during certain periods,

MicroStrategy plans to provide initial purchasers of the notes with an option to purchase, within 13 days beginning on, and including, the date on which the notes are first issued, up to an additional $75 million aggregate principal amount of the notes. 

As a firm that is keen on sustaining its Bitcoin strategy without fail, more of these convertible senior notes sales by MicroStrategy may happen more often. The issuance of Convertible Senior Notes is becoming quite popular with crypto firms with Coinbase also recently exploring the debt offering.