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MicroStrategy Raises $3 Billion in Convertible Notes for Bitcoin Acquisition

Arslan Butt•Friday, November 22, 2024•1 min read

MicroStrategy, led by BITCOIN maximalist Michael Saylor, has raised $3 billion in 0% convertible senior notes.

The funds will go towards adding to the company’s already massive Bitcoin holdings. The offering was increased by $400 million after institutional investors showed strong demand. The notes are 0% coupon and 55% premium. “MicroStrategy has done $3 billion in 0% notes,” Saylor tweeted.

The offering is Rule 144A and Regulation S for non-US investors. Another big move by the software turned Bitcoin investment company to become the largest institutional Bitcoin holder.

 

BTC/USD

Short-Selling Activity Pressures MicroStrategy Stock

While the offering is good for MicroStrategy, it’s also got some market participants concerned. Citron Research disclosed a short position in MicroStrategy’s stock and the stock dropped 16%.

In a tweet on X, Citron Research said: “Now that Bitcoin is easier to invest in than ever through ETFs and platforms like Coinbase ($COIN) and Robinhood ($HOOD), $MSTR’s trading volume has decoupled from Bitcoin fundamentals.” Citron added it’s still bullish on Bitcoin but shorting $MSTR as a hedge against the company’s business model.

Despite the criticism, MicroStrategy’s strategy is still making headlines and getting investors talking about its long term viability and the implications for institutional Bitcoin adoption.

Record-High Trading Volumes Outpace Tech Giants

MicroStrategy also briefly surpassed the trading volume of Nvidia Corp and other tech giants in the “Magnificent 7” group, including Tesla and Apple. The company did $33.27 billion in trading volume after the convertible notes announcement.

That’s a lot of volume. MicroStrategy is both a Bitcoin proxy and a high risk stock for traders and investors.

Key Highlights:

  • MicroStrategy raised $3 billion through 0% convertible notes with a strike price of $672.

  • Citron Research’s short position led to a 16% drop in MicroStrategy’s stock price.

  • Trading volume reached $33.27 billion, briefly surpassing Nvidia and other tech giants.

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ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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