MicroStrategy to Raise $1.75 Billion with 0/ Interest Notes to Boost Bitcoin Holdings

MicroStrategy, the world's largest corporate Bitcoin holder, has announced plans to raise $1.75 billion through senior convertible notes at a 0% interest rate. The funds will primarily be used to acquire additional Bitcoin, according to a company statement on Nov. 18.

A Strategic Move to Expand Bitcoin Holdings

The 0% senior convertible notes mean MicroStrategy won’t pay regular interest to bondholders. Instead, the notes are issued at a discount and will mature at face value if not converted by their 2029 maturity date. These bonds are “senior,” giving holders priority over common stock investors in the event of bankruptcy or liquidation.

At current Bitcoin prices, MicroStrategy could purchase approximately 19,065 BTC with the entire $1.75 billion raised. This would add to its already massive holdings of 331,200 BTC, valued at over $30.3 billion, as per Bitcoin Treasuries data.

On Nov. 18 alone, the company acquired another $4.6 billion worth of Bitcoin. This year, it has purchased 142,050 BTC, bringing its total investment in 2024 to roughly $12.8 billion.

Strong Returns on Bitcoin Strategy

MicroStrategy has seen remarkable success with its Bitcoin investment strategy, achieving a 133% return. The firm’s average purchase price for its Bitcoin is $39,292, significantly below its current market value.

Michael Saylor, MicroStrategy’s executive chairman, continues to champion Bitcoin as a cornerstone of the company’s growth strategy. Its stock (MSTR) closed at a record high of $374.8 on Nov. 18, a nearly 13% gain for the day, though it dipped 0.7% in after-hours trading.

Future Plans: The “21/21” Vision

MicroStrategy recently unveiled an ambitious “21/21” plan to raise $42 billion over three years — $21 billion from equity and $21 billion from fixed-income securities — to further bolster its Bitcoin holdings.

Bitcoin Near Record Highs

Bitcoin is currently trading at $91,653, just 2% below its all-time high of $93,477, achieved on Nov. 13, according to CoinGecko data.

MicroStrategy's aggressive Bitcoin acquisition strategy underscores its confidence in the cryptocurrency’s long-term value. The company’s moves could further solidify Bitcoin's role as a key corporate asset.

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