Strategy announces plans to raise $2 billion in bitcoin purchases

What’s new? US-based analytics software company Strategy, formerly known as MicroStrategy, has announced plans to raise $2 billion via 0% senior convertible notes to further expand its BTC holdings. According to a February 18 statement, the company also gave initial bond buyers the option to purchase an additional $300 million in bonds within five business days of issuance.

Strategy’s statement

Strategy said that the net proceeds from the offering will primarily be used to fund bitcoin purchases, with a portion going toward general working capital.

What else is known? The latest fundraising information is in line with Strategy 21/21’s ambitious plan to raise $42 billion over three years through a mix of equities and fixed income securities. The plan, promoted by Michael Saylor, the company’s executive chairman and co-founder, has already raised more than half of its endowment since its launch on October 30.

Strategy acquired nearly 200 000 bitcoins, bringing its total assets to approximately 478 740 BTC, making it the largest corporate holder of this asset in the world.

Senior convertible notes are a form of debt security that provides investors with the ability to convert their assets into equity at a later date. These notes have priority over common stock in the event of bankruptcy or liquidation, offering bondholders a higher claim on the company’s assets.

The new proposed convertible notes are due March 1, 2030, unless repurchased, redeemed, or converted earlier, and their issuance is subject to market conditions and other factors.

What changes has Strategy implemented? Effective January 1, 2025, the company implemented accounting rule ASU 2023-08, which allows its bitcoin assets to be measured at fair value, with gains and losses from changes in the fair value of BTC recognized in net income each reporting period. Until then, the company had written down the value of its bitcoin assets for impairment.

Despite aggressive bitcoin accumulation, Strategy reported a net loss of $671 million in Q4, even as the bitcoin price rose. Strategy (MSTR) shares fell slightly in the market, closing 1% lower on February 18 and remaining flat after the close of trading. Still, the stock has soared 372% over the past year, putting it among the best-performing US stocks over the past 12 months.