MicroStrategy Ups its Bitcoin-Centered Convertible Note Offering to $700 Million

Just a day after announcing a $500 million convertible senior note offering to purchase more BTC, among other goals, Michael Saylor’s brainchild increased its target to $700 million.

The company’s shares have been on a wild ride in 2024, perhaps due to the developments around the Bitcoin landscape, but have soared by triple digits since the start of the year.

$500M Not Enough

Ever since August 2020, when it announced its first BTC purchase, the NASDAQ-listed business intelligence software firm has been using various types of funding to accumulate more of the cryptocurrency. One of its methods included going into debt by offering convertible notes.

CryptoPotato reported earlier this week that the company announced plans to offer $500 million aggregate principal amount of convertible senior notes due 2032. However, the firm upped its target on the next day by 40% to $700 million.

The conditions remain the same, meaning that the percentage is still 2.25%, and the due year is 2032. They will be sold in a private offering to “persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933.”

As with previous such offerings, MicroStrategy said it intends to utilize the net proceeds to “acquire additional bitcoin and for general corporate purposes.”

Data from SaylorTracker shows that the company now owns 214,400 BTC (or over 1% of bitcoin’s total supply). Although the asset has retraced by roughly eight grand from its all-time high registered in March this year, MicroStrategy still sits on a massive unrealized profit of $6.6 billion.

MSTR Price Movements

Being such a massive BTC holder and strongly related to the cryptocurrency, MicroStrategy’s share prices are heavily impacted by bitcoin’s movements. This means that they had retraced quite violently in 2022, recovered some ground in 2023, and have been on a full-on bull run in 2024.

MSTR entered this year at just under $700 but fell in the first few weeks to below $500. However, as BTC started skyrocketing in March, the shares flew to an all-time high of over $1,900.

The BTC and MSTR price movements in the next few months have been identical. Although the stock prices have retraced since the peak in March (similar to bitcoin’s decline), they are still 120% up YTD as they closed Friday at $1,495.