MicroStrategy Launches Second Note Sale This Month to Buy More Bitcoin

March 13, 2024

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(Bloomberg) — MicroStrategy Inc. announced for the second time in less than two weeks that it will sell convertible notes to buy more Bitcoin while the cryptocurrency surges to record highs.

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The largest publicly-traded corporate holder of Bitcoin plans to offer $500 million of convertible, unsecured senior notes due in 2031, according to a statement Wednesday. The Tysons Corner, Virginia-based firm bought $821 million of Bitcoin with the proceeds from the sale of convertible senior notes due in 2030 that closed March 8.

Michael Saylor, the chairman and co-founder of MicroStrategy, started buying Bitcoin in 2020 as an inflation hedge and alternative to holding cash. MicroStrategy has already spent more than $1 billion on Bitcoin in the first three months of 2024, more than half of last year’s total buying. The cryptocurrency is up more than 675% since Saylor began buying.

Coinbase Global Inc., the largest US crypto exchange, said Tuesday it plans to offer $1 billion in convertible senior notes to repay existing debt and for general corporate purposes. The crypto companies are taking advantage of jumps in the value of their share prices amid the bull market in crypto. MicroStrategy holds more than $14 billion worth of the cryptocurrency.

Bitcoin has gained around 70% so far this year on the launch of US exchange-traded funds investing directly into the cryptocurrency. MicroStrategy’s shares have risen 180%, while Coinbase’s rallied 45% during the same period.

MicroStrategy plans to offer initial purchasers of the latest series of notes an option to buy up to an additional $75 million. The company, which said the sale is subject to change, said proceeds may also be used for general corporate purposes.