Call us skeptical, but this doesn’t sound so smart for a company involved in business intelligence.
MicroStrategy announced last summer that it had converted $500 million in cash to Bitcoin, which sounds a lot like an investment.
Now the company is selling off $900 million of debt through convertible notes, with the proceeds to be used for buying more of the digital currency.
The company, whose Chief Executive Officer Michael Saylor is one of the most vocal proponents of bitcoin, said proceeds of the offering will be about $879.3 million.
MicroStrategy said on Tuesday it will borrow $600 million to buy more bitcoin, as the cryptocurrency surged past $50,000 in a rally fueled by wider acceptance among investors.
Bitcoin has been soaring higher lately, but what happens if it rolls over, as it has in the past? Will MicroStrategy still be able to pay off the $900 million that it borrowed, or will the company force investors to convert their shares to cash?
It sounds like the company is set to reap all the rewards and the bond buyers are taking all the risk.