Marathon Digital Spends Hundreds of Millions USD to Buy Bitcoin: A Risky Investment?
Marathon Digital splashes 618 million USD to purchase Bitcoin
The Bitcoin mining company Marathon Digital recently spent 618 million USD in cash to buy 6,484 BTC, according to the latest report from the SEC. This transaction was made at an average price of 95,352 USD/BTC, near the market price peak when it surpassed 98,000 USD on the morning of December 3.
Positive Reaction
Following the announcement, Marathon Digital's MARA stock increased by 1.9% during trading hours in Europe, offsetting last week's 2% decline. The company's shares are currently trading at 26.85 USD.
Raising Capital to Expand Strategy
In addition to purchasing Bitcoin, it also plans to raise 700 million USD through private transactions with institutional investors. This amount will be used to:
• Buy more Bitcoin
• Pay off debt
• Expand assets and execute other strategic deals
Earlier, in November, Marathon also issued 850 million USD in convertible bonds, allowing the offering to expand up to 1 billion USD.
Marathon Digital's Position:
With this new deal, Marathon's holdings now amount to 3.3 billion USD, making it the second-largest Bitcoin holder in the world. However, it still lags far behind MicroStrategy - the “tycoon” owning nearly 37 billion USD in Bitcoin, under the leadership of Michael Saylor.
Commentary
Although the move to buy Bitcoin near peak prices may carry risks, Marathon Digital is demonstrating a strong commitment to the future of the crypto market. But is this a strategic move or a gamble? Investors need to carefully consider as the market is always highly volatile.
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