- Riot Platforms intends to use convertible notes to raise $500 million for corporate projects and Bitcoin purchases.
Riot Platforms, a Bitcoin infrastructure company, has announced plans to raise $500 million for institutional investors through convertible senior notes in a private sale.
This choice was made as other significant industry participants make large acquisitions at peak pricing and Bitcoin trades close to its all-time high.
Riot Platforms Plans to Make a $500 Million Offer to Finance Bitcoin Purchases: Important Information for Investors
The company announced on Monday that it would offer qualified institutional investors $500 million in convertible senior notes with a maturity of 2030 in a private offering.
Notably, the aforementioned digital asset will be acquired with the money raised from these offers.
Additionally, the business has given the original buyers a three-day window to purchase up to an extra $75 million worth of notes. The terms and completion of the offering are not guaranteed and are contingent on market conditions.
Beginning January 20, 2028, Riot is still able to exchange the notes for cash in full or in part. At least $50 million in principle must still be owed as of the redemption notice date if the account is partially redeemed.
At Riot’s option, the notes may be exchanged for cash, Riot common stock, or a mix of the two.
Before June 15, 2029, conversion will be limited to certain occasions; after that, it will be permitted at any time up to two days prior to maturity. Pricing will determine the first conversion rate and terms.
The offering’s proceeds will mostly be used to finance other business initiatives and more Bitcoin purchases. Riot intends to use the U.S. composite volume-weighted average price of its common stock on the pricing date to determine the first conversion price.
The Securities Act and other securities laws will not be used to register the notes or any convertible shares. Without the appropriate registration or exemptions, they are unable to trade publicly in the United States.
Riot did not sell any assets and ended the third quarter with 10,427 BTC, up 1,104 BTC. Compared to the 844 BTC mined in Q2, this represented an increase.
How Miners Are Protecting Money in the Face of Limited Supply and Political Upheavals as the Race for Bitcoin Heats Up
Convertible bonds are increasingly being used by Bitcoin miners to raise money, which is consistent with the news.
The Miner Mag reports that since June, seven publicly traded miners—aside from Riot—have funded $5.2 billion through convertible bonds, with 70% of the money raised in the four weeks preceding December 5.
Marathon Digital raised $1 billion in November, and Core Scientific issued $400 million in August. The money was utilized by the business to buy Bitcoin and manage debt. In just one week, Marathon added 6,474 Bitcoin to its portfolio, increasing its total to 34,797 Bitcoin.
Metaplanet, a Japanese company, did the same, selling shares to raise $45 million to fund Bitcoin purchases.
This is in line with the increasing institutional embrace of Bitcoin, which is being spearheaded by proponents like Michael Saylor, the inventor of MicroStrategy.
At an average price of $98,783 per Bitcoin, MicroStrategy stated on December 9 that it would buy 21,550 BTC for $2.1 billion.
Former MicroStrategy CEO and co-founder Michael Saylor recently shared his long-term optimism regarding Bitcoin.
Given political changes, like as the election of pro-Bitcoin U.S. President-elect Donald Trump, some analysts think the competition for Bitcoin’s limited supply is getting more fierce.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
