The largest publicly traded Bit miner, Marathon Digital, acquired 6,474 Bits after completing a $1 billion convertible note issuance this month. Its total Bit holdings now stand at 34,794 Bits, worth around $3.3 billion (at $95K). The success of MicroStrategy's strategy has made the BTC financial strategy more widely accepted, but analysts believe this model is more suitable for small companies.
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ToggleMarathon Digital Issued Zero-Coupon Convertible Bonds to Buy Bits
Marathon Digital announced a comprehensive HODL strategy at the end of July, in addition to fully retaining the Bits from its own mining, it also purchased an additional $100 million worth of Bits. In August, it began to emulate MicroStrategy, issuing convertible preferred notes (commonly known as convertible bonds) through private placement to qualified institutional buyers to purchase additional Bits and for general corporate purposes.
In November, Marathon Digital issued $1 billion in zero-coupon convertible bonds, of which $615 million was used to gradually buy 6,474 Bits at an average price of $95,395 per BTC. Another $200 million was used to repurchase a portion of the 2026 notes, and the remaining proceeds will be used to buy more Bits at lower prices in the future.
Marathon Digital, a publicly traded mining company, is the second largest corporate Bit holder, second only to MicroStrategy.
MicroStrategy's Successful Model is More Suitable for Small Companies
Anchorage Digital CEO and co-founder Nathan McCauley said in an interview with The Block:
Incorporating Bits into the balance sheet was once a reality only accessible to those in the crypto circle; now, with a bright outlook after the election, Bits have become mainstream. As the gates begin to open, it is expected that more and more publicly traded companies will view Bits as a reserve asset.
Two Prime Digital Assets CEO Alexander Blume also said:
The success of MicroStrategy has made the BTC financial strategy more readily accepted by other public institutions, and I suspect we will see more strategies emerge in the not-too-distant future. Acting early is rewarding.
Although tech giant Microsoft has included the "evaluation of investing in Bits" as a shareholder vote item on the agenda for its December 10th annual meeting, Bernstein analysts believe that while large tech companies have ample cash available to allocate to Bits, given their dominant positions in their core businesses, Bits may just be a side note.
However, small companies with excess cash and weak core businesses can follow the MicroStrategy model. MicroStrategy has a 4-year track record, including surviving the brutal bear market in 2022/23 and fully capitalizing on the opportunity.
