Strategy is raising $2 billion in convertible notes to purchase more Bitcoin

Strategy, previously called MicroStrategy, is raising $2 billion by issuing a type of loan called convertible notes announced on February 20, 2025.

The company will use this money to buy more Bitcoin and for general expenses.

These notes will not have regular interest payments (0% coupon). They will mature (be due for repayment) on March 1, 2030.

Investors can convert each $1,000 note into 2.3072 Strategy stock shares at a price of $433.43 per share (which is 35% higher than the current stock price).

The conversion price can change depending on market conditions.

The notes are available only to institutional (large professional) investors.

Investors can also buy an extra $300 million in notes within five days of the first sale.

Strategy follows a plan called the "21/21 Plan", aiming to raise $21 billion in debt and $21 billion in stock to buy more Bitcoin.

Recently, the company bought 7,633 more BTC (Bitcoin) and now holds 478,740 BTC, worth $46.4 billion. Despite these purchases, Strategy reported a $670 million loss in Q4 2024.

BlackRock, the world's biggest asset manager, now owns 5% of Strategy.

12 U.S. states, including California, Florida, Wisconsin, and North Carolina, hold $330 million worth of Strategy stock in their state funds.

Investors can convert their notes into stock under certain conditions.

Strategy can choose to pay in cash, stock, or a mix of both when the notes are converted.

After March 5, 2027, Strategy can redeem (buy back) the notes if its stock price stays 130% higher than the conversion price.

If the company goes through a major change (e.g., a merger), investors may demand repayment.

Strategy expects to raise about $1.99 billion to $2.28 billion after fees. The money will be used for Buying more Bitcoin and General business expenses.

The notes are being sold privately and are not registered with the SEC.

There is no guarantee that the sale will be completed as planned.

In conclusion, Strategy (formerly MicroStrategy) is raising $2 billion by selling convertible notes to buy more Bitcoin.

These notes don’t pay interest and can be converted into stock in the future. Big investors, like BlackRock and U.S. states, are investing in Strategy. Despite reporting losses, the company continues its aggressive Bitcoin-buying strategy.