The US-listed company with a large holding of Bitcoin, MicroStrategy, announced yesterday (13) that it plans to issue $500 million worth of convertible senior notes to compliant institutional investors and use the raised funds to continue increasing its Bitcoin holdings, but its stock price fell instead of rising.
MicroStrategy, the dominant holder of Bitcoin among US-listed companies, announced late yesterday that it plans to issue $500 million worth of convertible senior notes due in 2032 to qualified institutional investors in a private placement.
Continued Increase in Bitcoin Holdings
MicroStrategy explained in the announcement that the convertible senior notes issued this time will meet the following basic conditions:
They belong to unsecured senior debts of MicroStrategy, which will pay interest to investors and settle semi-annually starting from December 15, 2024, on June 15 and December 15 each year.
After June 20, 2029, MicroStrategy can redeem part or all of the bonds with cash.
Bondholders have the right to request MicroStrategy to redeem all or part of the bonds in cash on June 15, 2029.
The interest rate, initial conversion rate, and other terms of the bonds will be determined at the time of pricing.
However, more importantly, MicroStrategy stated that the proceeds from this bond issuance will continue to be used to purchase more Bitcoin.
MSTR Opens with a Nearly 8% Decline
Since announcing continued investments in Bitcoin in August 2020, MicroStrategy’s stock (MSTR) has entered a surge mode, and after entering a concentrated explosive period with the arrival of the Bitcoin bull market, the stock price has often been boosted after announcing multiple increases this year.
However, this time, although MSTR rose by 3.1% in pre-market trading, it then fell all the way, closing at $1483.88, down 7.47%. Although Bitcoin’s performance was also poor last night, the decline of MSTR was deeper, and the actions of repeated increases seem to have trouble supporting the stock price.
Bitcoin surged to $70,000 after the CPI was announced the night before yesterday, but then continued to fall, reaching a low of $66,258 at midnight today (14), with the current price at $66,630, a decrease of 2.4% in the past 24 hours.
MicroStrategy’s Bitcoin Unrealized Profit Reaches $6.73 Billion
Despite Bitcoin’s ongoing volatility, according to the latest data from bitcointreasuries, MicroStrategy’s current Bitcoin holdings are 214,400 BTC, purchased at a cost of approximately $7.543 billion, with a current total value of $14.276 billion and an unrealized profit of $6.73 billion.