MARA Holding, listed as MARA on Nasdaq, stated that the funds will go toward acquiring bitcoin (BTC), refinancing existing debt, and other general corporate needs. Announced Friday, the issuance was finalized on Nov. 20, 2024, and included $150 million in extra notes offered through an optional provision for initial investors.
MARA disclosed that these notes were sold privately to qualified institutional buyers under Rule 144A of the Securities Act of 1933. After covering associated costs, the firm secured approximately $980 million. Of this, $199 million was used to retire $212 million in principal of its 2026 convertible notes.
The remaining proceeds primarily supported bitcoin acquisitions. MARA has added 5,771 BTC to its holdings at an average price of $95,554 per bitcoin, bringing its total reserves to around 33,875 BTC. These holdings, based on a spot price of $99,000 per BTC at the time of the announcement on X, were valued at approximately $3.4 billion.
The 0% convertible notes are unsecured senior obligations that mature on March 1, 2030. They carry a conversion rate of 38.5902 shares of MARA’s stock per $1,000 principal amount, equivalent to a conversion price of $25.91 per share—a 42.5% premium to the stock’s volume-weighted average price at issuance.
Following the news, Microstrategy co-founder Michael Saylor took to X, declaring, “MARA is a company on the Bitcoin Standard.” Meanwhile, bitcoin critic Peter Schiff fired back, saying, “So another conman is now targeting your marks. This should be interesting.” MARA CEO Fred Thiel responded, “We focus on creating value and accumulating bitcoin. No better asset in the world.”
Schiff’s remarks echo growing skepticism about Microstrategy, recently fueled by critiques from short sellers such as Citron Research. The company’s strategy of leaning on convertible notes to bankroll its crypto acquisitions reveals a bold approach to expanding its bitcoin portfolio through debt. These notes, which sidestep immediate interest payments, come with a trade-off—potential dilution of shareholder equity when converted into stock.
This strategy further links companies directly to bitcoin’s unpredictable price movements, making them vulnerable to significant valuation drops, if BTC’s price takes a hit. Despite this, firms like Microstrategy, Metaplanet, Semler Scientific, Acurx Pharmaceuticals, Cosmos Health, MARA, and several others see bitcoin as a reliable hedge against inflation and the erosion of value. For MARA, being a bitcoin miner also means profiting from its computational muscle, turning its operations into a source of digital gold.
As bitcoin’s market trajectory unfolds, the Bitcoin Standard approach may serve as a benchmark for firms navigating similar opportunities. The issuance’s success reflects both investor appetite for bitcoin-centric ventures and the growing acceptance of digital assets as strategic holdings. How this strategy fares will not only define MARA’s future but could also shape broader market dynamics for a slew of bitcoin-focused enterprises.
