Bitrabo Editorial
On Monday, Microstrategy, a firm known for its business intelligence and led by Bitcoin enthusiast Michael Saylor, unveiled plans to issue $700 million in convertible senior notes due in 2028. This move is part of a larger strategy aimed at bolstering its Bitcoin assets and restructuring its current debt.
MicroStrategy’s Intentions for Bitcoin
The company’s announcement specified that these notes will be unsecured, senior obligations, and are expected to yield interest payable semi-annually beginning March 15, 2025.
These notes will mature on September 15, 2028, unless they are converted or repurchased earlier under certain conditions. Additionally, the company plans to offer initial purchasers an option to acquire up to an extra $105 million in notes over a 13-day period following the initial sale.
The funds raised will primarily be used to redeem $500 million worth of existing 6.125% Senior Secured Notes due in 2028. This action will not only alleviate the company’s debt but also free up collateral associated with these notes, which includes around 69,080 BTC.
The planned redemption date is September 26, 2024, pending the successful closing of the new notes offering to qualified investors.
Recent Investments Surpass $9.45 Billion
This announcement follows Microstrategy’s recent acquisition of 18,300 Bitcoin worth approximately $1.11 billion, which has increased the company’s total Bitcoin holdings to around 244,800 BTC.
This considerable investment represents about 1% of all Bitcoins mined, reinforcing MicroStrategy’s status as a prominent institutional owner of Bitcoin, the leading cryptocurrency.
MicroStrategy’s total investment in Bitcoin is now about $9.45 billion, with an average buying price of roughly $38,585 per Bitcoin.
Currently, Bitcoin is priced at $57,760, reflecting a 3.5% decline over the last 24 hours. However, despite this recent drop, Bitcoin has maintained a 1.5% gain over the past week.
Yet, looking at longer-term charts, there are concerns as Bitcoin has shown a bearish trend over the past months, particularly after falling below the $70,000 mark in early August. According to CoinGecko data, losses of 1.4% and nearly 3% have been recorded over the fourteen and thirty-day periods, respectively.
Despite these fluctuations, Bitcoin remains active in trading volume, recording a significant 125% rise in the last 24 hours, totaling nearly $32 billion. The market’s ability to remain stable amidst potential volatility this week remains uncertain, especially with the Federal Reserve’s forthcoming rate cut announcement.
Image sourced from DALL-E, chart by TradingView.com