Key Points
- Bitcoin miner Marathon Holdings has increased its Bitcoin holdings to $3.9 billion after a convertible note sale.
- Competitor Riot Platforms also plans to purchase Bitcoin using proceeds from its $500 million convertible note sale.
After successfully selling convertible notes, Marathon Holdings, a Bitcoin mining company, has expanded its Bitcoin holdings to a whopping $3.9 billion.
The Florida-based blockchain infrastructure firm bought 11,774 Bitcoin (BTC) for an estimated $1.1 billion. The average price per token was approximately $96,000.
Convertible Notes and Bitcoin
Marathon Holdings raised the funds for its Bitcoin purchase through the offering of convertible notes. This is becoming a popular trend among companies building Bitcoin treasuries.
Investors purchase these notes with cash, receiving rights to company shares in return. The companies then use the raised funds to acquire Bitcoin.
This strategy, initially popularized by MicroStrategy chairman Michael Saylor, has led to the introduction of a new metric for measuring corporate Bitcoin purchase performance. This metric, known as “BTC Yield”, measures the percentage changes in Bitcoin holdings relative to outstanding diluted company shares.
Marathon’s Bitcoin Yield
Marathon reported a 12.3% quarter-to-date and 47.6% year-to-date Bitcoin yield as of Dec. 9. Companies are also considering Bitcoin-based rewards for shareholders, which would further integrate cryptocurrency and corporate finance.
In the meantime, Riot Platforms, a competitor to Marathon in the Bitcoin mining space, has plans to purchase Bitcoin using the proceeds from its $500 million convertible note sale. Saylor has commended both Marathon and Riot for their adoption of the Bitcoin Standard, indicating a growing interest in Bitcoin among U.S.-based entities.
MicroStrategy has led the charge in this movement of companies exchanging share rights for Bitcoin capital. Saylor’s firm has purchased over $25 billion worth of Bitcoin since 2020, issuing securities and raising debt to cover the cost. MicroStrategy is also the largest private holder of Bitcoin, with over $40 billion in the digital asset.
