Marathon Digital CEO Hints at Potential Bitcoin Purchase via Convertible Bonds
Fred Thiel, CEO of Bitcoin mining company Marathon Digital, has suggested that the company could raise capital via convertible bonds in the future to buy more of the leading digital asset.
This comes after the company recently purchased $100 million worth of Bitcoin, bringing its total holdings to over 20,000.
Future Purchases
In a Telegram message CryptoSlateThiel said publicly traded Bitcoin miners could buy more of the top asset on the open market when conditions are favorable for shareholders.
He said:
“From a shareholder perspective, if we feel the situation is right, we will do so.”
The statement is consistent with the company’s commitment to strategically acquire top cryptocurrencies on a regular basis and to adopt a full HODL strategy. Following the miner’s recent purchase, Thiel described the digital asset as “the world’s best treasury reserve asset” and urged that “governments and corporations alike should hold Bitcoin as a reserve asset.”
Meanwhile, it’s no surprise that Marathon is hungry for Bitcoin, considering it’s the world’s largest mining operation. And this isn’t the first time the miner has bought Bitcoin outside of mining production. In January 2021, it raised $150 million worth of Bitcoin.
Convertible bonds
Asked how the company would fund future acquisitions, Thiel suggested the company adopt a convertible bond strategy, noting that the company is comfortable with the process.
He said:
“It all comes down to a cost of capital decision. We’ve done conversions in the past (fall 2021), so we’re comfortable using conversions as a funding tool.”
Convertible bonds allow investors to convert debt into equity at a later date, usually at a discount to the stock price at the time of conversion. This type of financing allows companies to raise capital without immediately diluting shareholder value.
MicroStrategy has popularized this strategy by frequently buying Bitcoin over the past year. The company holds over 200,000 BTC, making it the largest corporate Bitcoin holder.
