MicroStrategy Issues $700M in Convertible Notes to Fund Bitcoin

MicroStrategy. Image: Shutterstock
  • Michael Saylor’s company, MicroStrategy, announced on Wednesday that it was increasing its convertible debt offering—to fund the purchase of more Bitcoin—from US$600 million to US$700 million.
  • The conversion price of the notes will be 42.5% higher than MicroStrategy’s share price at the close of trade on Tuesday.
  • MicroStrategy is the largest holder of Bitcoin of any publicly listed company, with over 193,000 BTC currently valued at approximately US$13 billion.

Life advice: Find someone who loves you the way Michael Saylor loves Bitcoin.

Saylor’s company, MicroStrategy, announced on Wednesday that it’s upgrading its US$600 million (AUD$905 million) convertible debt offering announced earlier this week to US$700 million (AUD$1.05 billion), in order to enable the purchase of even more of the world’s largest cryptocurrency.

Related: Bitcoin’s Ride as Wild as a Rollercoaster, Gary Gensler Silent on Ethereum ETF

It would seem Saylor thinks there’s more upside in Bitcoin, despite it reaching all time highs just this week and some predicting a correction might be incoming.


Details Of MicroStrategy’s Capital Raise

Convertible senior notes are debt securities that earn interest and come with an option to convert the notes into shares of the issuing company.

MicroStrategy’s updated capital raise now seeks to raise US$700 million through the sale of convertible senior notes with an interest rate of 0.625%, according to the company’s press release.

The company also announced what its convertible debt will be priced at, saying the notes will have a conversion rate equal to US$1,497.68 (AUD$2,259.24) per share — a 42.5% premium compared to Tuesday’s closing price of US$1,051.01 (AUD$1,585.49).

Saylor Is A Recent Bitcoin Devotee

Having previously been sceptical of Bitcoin, Saylor became a full blown devotee after studying up on the OG crypto during COVID lockdowns. His company, MicroStrategy, first purchased Bitcoin in August 2020 and has since accumulated over 193,000 BTC, currently valued at around US$13 billion, making it the largest HODLer of any publicly listed company.

Related: Aussie Analyst Jason Pizzino Reveals Crypto Buying Opportunities

Due to its enormous Bitcoin holdings, MicroStrategy stock now behaves as a virtual proxy for the cryptocurrency. This makes it something of a competitor to the new Bitcoin spot ETFs, which are run by some of the world’s largest asset managers, such as BlackRock and Fidelity. 

Jody McDonald

Jody McDonald

Jody is a Brisbane-based freelance writer who specialises in writing about business, technology, and the future of work.

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