As a seasoned researcher with years of experience in the cryptocurrency market, I find Riot Platforms’ decision to raise $500 million to buy more Bitcoin intriguing but not entirely surprising. The current bull run has certainly caught the attention of many major players in the industry, and it seems that Riot is jumping on the bandwagon.
According to Riot Platforms, they plan on seeking $500 million to invest in purchasing more Bitcoin. They might do this by offering private bonds to institutional investors who meet certain qualifications. This move is being made as Bitcoin approaches its record high value, and other major players in the industry have recently made significant purchases at peak prices.
Confidence rather than interest
Riot could provide senior convertible notes for investment through private offering documents. If buyers choose to, they can add an extra $75 million worth of these notes within three days following their initial purchase. However, the availability of this offer depends on market circumstances, as stated. No details were given about potential interest payments.
These notes represent an unsecured debt obligation by the company, due on January 15, 2030. They may either be redeemed or exchanged for Riot common stock at the discretion of the company. The conversion rate and other specific terms will be established when the offering is priced.
Riot will use the funds “to acquire additional Bitcoin and for general corporate purposes.”
At the close of the third quarter, the riot had amassed 10,427 Bitcoin (BTC), having mined 1,104 BTC that particular quarter without any sales. The quarter prior to this, they had mined 844 BTC.
Great miners think alike
As reported by The Miner Mag, over the past four months, excluding Riot, seven publicly listed Bitcoin miners and data centers have issued convertible bonds. These issuances have collectively raised a massive $5.2 billion. Remarkably, nearly 70% of this total sum was amassed in the last four weeks prior to December 5th.
One significant offering that stood out was Core Scientific’s initial offering of $350 million in August, which was increased to a total of $400 million just a day later.
On November 21st, MARA (formerly known as Marathon Digital), announced the issuance of $1 billion in convertible notes. This move was aimed at handling existing debts and purchasing Bitcoin. A week after this announcement, MARA disclosed that it had procured 6,474 Bitcoins, increasing its total Bitcoin holdings to approximately 34,797 Bitcoins.
On December 9th, coinciding with Riot’s announcement, MicroStrategy stated that they had purchased approximately 21,550 Bitcoins at a total cost of $2.1 billion between December 2nd and December 8th. This equates to an average price of approximately $98,783 per Bitcoin.
Michael Saylor, the co-founder and ex-CEO of MicroStrategy, expressed his belief that he will purchase a Bitcoin coin for one million dollars each.
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2024-12-09 20:47