With the surge in Bitcoin prices, many companies have begun to follow MicroStrategy's lead by raising funds through the sale of convertible bonds to purchase Bitcoin, successfully achieving profits. As a pioneer of this strategy, MicroStrategy issued $6.2 billion in convertible bonds this year and plans to raise a total of $21 billion through the sale of fixed-income securities.
Investors are flocking to companies connected to the industry, opening the floodgates for financing. MARA Holdings sold over $2 billion in bonds to purchase Bitcoin, while Core Scientific raised over $1 billion. On Monday morning, Riot Platforms announced plans to issue $500 million in convertible bonds to increase its Bitcoin reserves.
Raj Imteaz, head of convertible bonds and equity derivatives consulting at ICR Capital LLC, stated:
<blockquote>
&#34;An important theme this year is the focus on convertible bonds issued by cryptocurrency companies. In the future, cryptocurrency companies will have more transactions.&#34;
</blockquote>
Since the U.S. presidential election, Bitcoin's price has risen by more than 40%, partly due to President-elect Trump's choice of pro-cryptocurrency financier Paul Atkins as chairman of the U.S. Securities and Exchange Commission (SEC). The market's increased investment interest in cryptocurrency-related companies once pushed Bitcoin's price above $100,000.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/9975ba91-5dde-4bd5-ae87-8259ca6a686f.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/9975ba91-5dde-4bd5-ae87-8259ca6a686f.png"/>
Since the election, MicroStrategy's stock price has risen by 73%, while MARA, Riot Platforms, and Core Scientific's stock prices have increased by 63%, 33%, and 30%, respectively. This rise in stock prices aligns with Bitcoin's over 40% increase, with Bitcoin's market capitalization currently around $2 trillion.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/8ee68b3e-1ad1-4580-b3eb-de45088a899c.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/8ee68b3e-1ad1-4580-b3eb-de45088a899c.png"/>
On Monday, MicroStrategy disclosed that the total value of its Bitcoin holdings has exceeded $41 billion. According to SEC filings, the company has purchased approximately $15.6 billion in Bitcoin since October 31.
Notably, according to data compiled by Bloomberg, four convertible bond transactions announced by crypto companies since early November were priced at zero coupon. These transactions also allowed hedge funds to adopt convertible bond arbitrage strategies, essentially betting on the volatility of the underlying stocks. The greater the stock volatility, the more profit from the trades, and the stock prices of MicroStrategy and other companies issuing convertible bonds have been quite volatile.
However, this phenomenon also indicates that these companies have given little consideration to the risks of Bitcoin price declines. Imteaz stated:
<blockquote>
&#34;If you are one of the large companies in this field, and your competitors have substantial funds with very low interest rates, while you have not entered the market, then you will be at a competitive disadvantage. To remain competitive in the cryptocurrency space, companies almost have to issue convertible bonds.&#34;
</blockquote>

MARA

MSTR

MARA Holdings sold over $2 billion in bonds to purchase Bitcoin, while Core Scientific raised over $1 billion. Since the election, the stock prices of MARA and Core Scientific have increased by 63% and 30%, respectively

- Following the surge in Bitcoin prices, many companies are emulating MicroStrategy by issuing convertible bonds to raise funds for Bitcoin purchases, achieving significant profits.  
- MicroStrategy has issued $6.2 billion in convertible bonds this year and plans to raise a total of $21 billion, while other companies like MARA Holdings and Core Scientific have also raised substantial amounts through similar means.  
- The increased interest in cryptocurrency-related investments has led to a rise in stock prices for these companies, with MicroStrategy's stock up 73% since the U.S. presidential election, reflecting the growing market for convertible bonds in the crypto sector.

Wallstreetcn

Mara

Issuing bonds to buy cryptocurrencies! More and more companies are starting to follow MSTR