MARA Holdings, one of the largest publicly traded Bitcoin mining companies, acquired 6,474 Bitcoin (BTC) valued at approximately $619 million. The acquisition was made possible through the company’s recent $1 billion convertible note offering, which carries a 0% interest rate. 

This fundraising initiative allowed MARA to purchase an additional 703 Bitcoin, adding to the 5,771 Bitcoin acquired previously on Nov. 23. The average price per Bitcoin in this transaction was $95,395. 

With this acquisition, MARA now holds approximately 34,794 BTC, which is valued at about $3.306 billion based on the current Bitcoin price of $95,029 per coin.

Convertible Notes: A Key to Expanding Bitcoin Holdings

Convertible notes are a form of debt financing where the debt can later be converted into equity. In MARA’s case, these notes are due in 2030 and are being issued at a 0% interest rate. 

The lack of interest makes the offering particularly attractive, allowing MARA to focus its resources on Bitcoin purchases rather than paying high interest. The move is viewed as a strategic effort to acquire more Bitcoin while reducing immediate financial burdens.

Approximately $199 million of the proceeds from the offering have been allocated to repurchase existing convertible notes due in 2026. This buyback reportedly reduces the company’s debt load, freeing up more capital to continue investing in Bitcoin. 

After repurchasing these notes, MARA has around $160 million left for future Bitcoin acquisitions, particularly if there is a price dip in the market. 

MARA’s Growing Bitcoin Reserves and Market Position

This aggressive expansion of Bitcoin holdings mirrors a broader trend in the industry, as other companies such as MicroStrategy also use convertible debt to purchase Bitcoin. 

MicroStrategy, for example, recently raised $3 billion through a similar offering and acquired 55,000 BTC. These companies see Bitcoin as a hedge against inflation and a way to diversify their portfolios.

While MARA’s strategy of leveraging convertible notes to acquire Bitcoin has been effective so far, it is not without risks. Critics argue that using debt to purchase a volatile asset like Bitcoin could put the company in a difficult financial position if Bitcoin’s price drops sharply, according to The Crypto Times.

In the case of MicroStrategy, its stock saw a 25% decline in late November after the company’s convertible note offering.