Riot Plans $500M Convertible Notes to Acquire Bitcoin

Riot Platforms (NASDAQ: RIOT) is following in the footsteps of its public mining peers with plans to issue $500 million worth of convertible bonds, aiming to acquire Bitcoin directly from the market—a strategy reminiscent of MicroStrategy’s playbook.

The company announced on Monday its intention to conduct a private offering of $500 million in senior convertible notes, with an option for initial buyers to purchase an additional $75 million within three days of issuance.

The Texas-based Bitcoin mining giant stated that the net proceeds from the offering would be used to acquire more Bitcoin and for general corporate purposes. So far in 2024, Riot has mined 4,312 BTC through its proprietary mining operations and sold 250 BTC, leaving it with a Bitcoin reserve of 11,425 BTC as of November 30.

Riot’s proposed bond issuance mirrors similar moves by its key competitor MARA. MARA has raised nearly $2 billion through zero-coupon convertible notes and reportedly purchased an additional 1,423 BTC following its most recent fundraising round in early December, according to on-chain data.

Last week, it was reported that seven other public mining companies—excluding Riot—had collectively raised over $5.3 billion since June through convertible note issuances, using the funds to support growth initiatives or acquire more Bitcoin.