MicroStrategy is a company that provides business intelligence, mobile software, and cloud-based services to its users. But it has another domain of business that it deals in, which is cryptocurrency. The trend to purchase cryptocurrency such as Bitcoin is on the rise, and this means if you want to become a potential buyer, you must have your hands on serious money to do so. But if you don’t and still want to make an investment, you need to go for a convertible note.
MicroStrategy’s Big Announcement about Convertible Note and Bitcoin’s Price Surge
It is a short-term debt that will convert into equity. It means that whatever you owe in terms of debt when you give it back, it will convert into shares of that particular company’s preferred stock. This is what’s happening with MicroStrategy.
About a month ago, MicroStrategy raised about $650 million as a convertible note that could be used to purchase Bitcoin, and today again, a massive $600 million convertible note has been issued so that investors and financial institutions be able to buy Bitcoin.
The news of such convertible note opportunity present in the market spiked the price of Bitcoin to almost $50,085, which landed down to $49650 after some time.
Terms and Conditions Encompassing MicroStrategy’s Convertible Notes
The convertible notes will be unsecured and will beat interest that will be payable semi-annually. Arrears have also been assigned on February 15 and August 15 of each year. The process of purchasing the convertible notes will start no sooner than August 15, 2021. These convertible notes’ maturity date has been pushed to February 15, 2027. But if you have repurchased these earlier, redeemed, or converted according to the accepted terms at the time of acquiring convertible notes.
MicroStrategy may redeem these convertible notes it is giving away on cash-all or portions of the notes, the announcement clarified. The endgame for MicroStrategy is to acquire more bitcoins through the net proceeds from the sale of these convertible notes. Not everyone will be entitled to purchasing these convertible notes as only the qualified intuitional buyers who are in accordance with Rule 144A under the securities act will be offered the purchase of convertible notes.
MicroStrategy will keep on buying more and more Bitcoins through the sale of these notes, which will tempt other institutional and financial firms to invest some of their own money into buying convertible notes.