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Strategy, known for its extensive Bitcoin holdings, announced plans to issue $2 billion in convertible senior notes at 0% interest. The company stated the proceeds would be used for general corporate purposes, including further Bitcoin acquisitions.
The notes are set to mature on March 1, 2030, with the option for early repurchase, redemption, or conversion. Strategy has outlined that conversions will be settled in either cash, class A common stock, or a combination of both. Additionally, the firm is offering initial purchasers the option to buy up to an additional $300 million in notes within the first five business days after issuance.
This financial move follows Strategy’s earlier announcement on the same day, where the firm issued a profitability warning in a 10-K filing with the U.S. Securities and Exchange Commission.
The warning highlighted concerns over a potentially increased tax burden and reflected on the net loss for the fiscal year ended December 31, 2024, which was primarily attributed to $1.79 billion of digital asset impairment losses. The company expressed doubts about regaining profitability in the future, especially if it faces significant fair value losses on its Bitcoin investments.
Strategy’s Bitcoin treasury has been expanding, with the company acquiring approximately 258,320 BTC in 2024. Following its most recent purchase between February 3-9, Strategy’s Bitcoin holdings have grown to 478,740 BTC, valued at over $46 billion.
The substantial investment in Bitcoin underscores the company’s commitment to the cryptocurrency as a strategic asset, despite the potential risks outlined in its profitability warning.
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