Marathon Digital raises $850M in Convertible Notes

The Bitcoin mining firm, headquartered in Fort Lauderdale, Florida, announced Monday its plan to issue $850 million in convertible notes, with the option to expand to $1 billion. Of the expected $833 million in net proceeds, $199 million will go toward repurchasing $212 million of its existing 2026 convertible notes.

The remaining funds will be allocated to purchasing additional Bitcoin, supporting corporate initiatives, and expanding Marathon’s operations, according to the company’s statement.

Convertible Notes and Bitcoin Acquisitions

Convertible notes, a debt-based financial tool, allow investors to convert their holdings into equity shares, providing them partial ownership of the issuing company. Marathon’s decision to issue such notes comes as Bitcoin’s market price exceeds $94,000, driving renewed interest in institutional acquisitions.

Prominent companies like MicroStrategy and Japan’s Metaplanet have also bolstered their Bitcoin holdings. MicroStrategy’s stash, valued at $30 billion, leads the pack, while Metaplanet added over 1,000 BTC this year, worth roughly $93 million.

Terms of the Notes

Marathon’s convertible notes mature on March 1, 2030 and provide holders flexibility in redemption. Starting December 1, 2027, noteholders can request repurchase for cash. The notes can also be converted into cash, MARA stock, or a mix of both. However, terms may vary in the event of significant corporate actions such as mergers or delisting.

Market Momentum and Stock Performance

Bitcoin’s ongoing rally has revitalized the crypto market, encouraging firms like Marathon to double down on their strategies. On Tuesday, Marathon’s stock (MARA) closed at $19.86, up 9% on the day, reflecting investor optimism.

The funds raised from the note issuance will not only strengthen Marathon’s balance sheet but also position the company to capitalize on Bitcoin’s increasing value and growing institutional adoption.