MicroStrategy’s $3 Billion Debt Offering to Fund Bitcoin Expansion

Leading business analytics firm MicroStrategy has successfully concluded a $3 billion sale of senior notes with 0% convertible interest that are due in December 2029. The business intends to spend all or a portion of the money to keep up its aggressive acquisition strategy for Bitcoin. With its ambitious “21/21” strategy, which aims to raise $42 billion in cash to purchase additional Bitcoin over the next three years, MicroStrategy is making this move as it looks to increase its holdings.

Details of the Convertible Senior Notes Offering

The 0% convertible senior notes were sold at a 55% premium, with an implied strike price of approximately $672. This means that, if the notes are converted into stock, holders will have the option to buy MicroStrategy’s Class A common stock at this predetermined price. Unlike traditional bonds, these notes do not pay regular interest but instead mature to face value unless converted before the maturity date.

These notes are classified as “senior,” meaning they hold priority over common stock in the event of bankruptcy or liquidation. If MicroStrategy were to invest all $3 billion in Bitcoin, it could acquire around 30,600 BTC, based on the current value of Bitcoin.

This offering follows a prior announcement in November 2023 when MicroStrategy aimed to raise $1.75 billion at 0% interest, which was later increased to $2.6 billion. The latest offering is part of the company’s broader strategy to accumulate Bitcoin and strengthen its position in the cryptocurrency market.

Currently, MicroStrategy holds over 331,000 Bitcoin, valued at more than $32.7 billion, making it the largest corporate Bitcoin holder. The company’s aggressive strategy continues to drive its goal of owning 1 million BTC under its “21/21” initiative.