Marathon’s $250 Million Fundraise for Bitcoin Acquisition
Marathon Digital Holdings, Inc. is set to raise $250 million through a debt offering to expand its bitcoin holdings, mirroring the approach taken by MicroStrategy. The convertible senior notes issued by Marathon will accrue semi-annual interest and are due to mature in September 2031, with provisions for early redemption or conversion into cash or company stock. This offering is exclusively available to qualified institutional buyers, with an option for initial purchasers to acquire an additional $37.5 million in notes within 13 days of the issuance.
In response to the announcement, Marathon’s shares experienced a decline. The company recently made headlines with a $100 million bitcoin purchase in late July, bringing its total bitcoin holdings to over 20,000. This places Marathon as the second-largest publicly traded company in terms of bitcoin reserves, according to Bitcoin Treasuries.
MicroStrategy, the only company surpassing Marathon in bitcoin holdings, previously utilized convertible notes to bolster its bitcoin reserves earlier this year. Embracing bitcoin as a reserve asset in 2020, MicroStrategy set the precedent for incorporating cryptocurrencies into corporate balance sheets.
The trend of integrating bitcoin into company reserves is gaining momentum, with other entities following suit. Fintech startup Fold and healthcare firm Semler Scientific have recently made similar moves, while established players like Tesla and Block (formerly Square) have also adopted bitcoin strategies in recent years.
Following the announcement of the convertible note offering, Marathon’s stock experienced a more than 10% drop on Monday. Meanwhile, the price of bitcoin continues to hover above $58,600. This development underscores the growing intersection between traditional finance and the cryptocurrency market, as companies seek to leverage digital assets as part of their financial strategies.
