MicroStrategy Looks to Raise $400M in Private Offering of Convertible Senior Notes

According to a press release, MicroStrategy is looking to raise $400 million in a private offering of convertible senior notes. Michael Saylor, CEO of the business analytics company, confirmed the raise in a tweet published on Monday afternoon. 

This offering would allow the company to purchase more bitcoin, adding to the $780 million it already holds in the cryptocurrency, as per BitcoinTreasuries. 

The convertible note is a debt security that can be convertible into cash, shares of MicroStrategy’s class A common stock, or a combination of cash and shares of MicroStrategy’s class A common stock, at MicroStrategy’s election. By selling these securities, MicroStrategy will raise cash but will have to repay the bond holders with interest at a later date.

The press release states that the proceeds from this prospective sale may be used to purchase bitcoin:

“MicroStrategy intends to invest the net proceeds from the sale of the notes in bitcoin in accordance with its Treasury Reserve Policy pending the identification of working capital needs and other general corporate purposes.”

CoinMetrics co-founder Nic Carter said that he sees this as MicroStrategy planning a "speculative attack on the USD."

This latest move comes just days after the company deployed $50 million into bitcoin, purchasing an additional 2,574 coins at an average price of $19,427. 

This latest decision to pursue more capital to buy bitcoin also comes after CNBC anchor Melissa Lee questioned Michael Saylor on whether MicroStrategy is becoming a Bitcoin-focused hedge fund as opposed to a business analytics and services business.