Business intelligence firm MicroStrategy recently completed its $3 billion offering of convertible notes, according to Michael Saylor, the cofounder and executive chairman of the business intelligence firm.
A senior convertible note is a type of debt that, as the name suggests, can eventually be turned into the company’s stock. It is considered to be a relatively cheap and easy option for companies to secure more funding.
The notes do not offer regular interest, but investors believe that they can profit by converting these notes into the company’s stock at a later date. The notes have a premium price of about $672.40 per share, which is 55% higher than the MSTR price at the time when the deal was finalized.
The company is supposed to pay back the principal amount of the notes ($3 billion) by 2029 if the notes are not converted.
MicroStrategy intends to use the proceeds from its most recent debt offering in order to buy more Bitcoin. Its BTC holdings have already swelled to $32.7 billion following its most recent mammoth purchase.
The MicroStrategy (MSTR) stock has been on a tear this year, surging by nearly 500% on a year-to-date basis.
Meanwhile, Citron Research recently took a short position in the high-flying company, putting a dent into its blistering rally on Thursday. MSTR was down 16.16% yesterday.
The company argues that MicroStrategy’s volume is “completely detached” from fundamentals, noting that they are more straightforward Bitcoin investment options, like spot ETFs, that were launched earlier this year.
Despite claiming that MicroStrategy is “overheated,” Cintron Research remains bullish on Bitcoin.