Marathon Digital Bitcoin Investment Continues To Be Bolstered With $250M Convertible Notes

Key Points:

• Marathon Digital is raising $250 million through a private offering of convertible senior notes, maturing in 2031.
• The notes will be offered to institutional buyers with options for conversion into cash or Marathon’s common stock and can be redeemed starting September 6, 2028.
• The Marathon Digital Bitcoin investments follow the company’s recent $100 million BTC purchase.

Marathon Digital, one of the larger Bitcoin mining companies, announced that it wants to raise $250 million through a private offering of convertible senior notes.

Read more: Marathon Digital Quarterly Losses Soar With 20,000 BTC In Balance

Marathon Digital Bitcoin Investments Boosted With Convertible Notes

The notes will only be due until 2031, and this forms part of the plan for the expansion of Marathon Digital Bitcoin investments.

According to a press release, the offering would be made available to qualified institutional buyers in accordance with Rule 144A of the Securities Act of 1933. The notes will be unsecured, senior obligations, with semi-annual interest payable on March 1, 2025, and each succeeding March 1 and September 1 thereafter.

Investors have the option of cash, shares of common stock of Marathon, or a combination of both. In addition, initial purchases may purchase up to an additional $37.5 million in aggregate principal amount of the notes.

New Notes Offer Investors Options of Redemption

The notes may be redeemed on or after September 6, 2028, with a partial redemption condition: at least $75 million aggregate principal amount shall remain outstanding. Holders have the right to demand cash repurchase on March 1, 2029.

This follows Marathon’s acquisition of $100 million of Bitcoin in July, made with the intention to drastically increase its Bitcoin holdings to over 20,000 BTC.

The block rewards for Bitcoin have now dropped by 50%, based on the 2024 halving. However, Marathon Digital Bitcoin investments carry on. This deviates heavily from the likely sell-off behaviour that would be expected in the rest of the industry.

Corporate adoptions rise with the interest in Bitcoin as a reserve asset in spite of volatility and accounting headaches accompanying the rise of spot Bitcoin ETFs. While Marathon’s proactive strategy and acquisitions have been remarkable, Bitcoin’s price is still trading below $60,000 at the time of writing.