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MicroStrategy has recently increased its bitcoin holdings, while an analyst team has raised its price target for Coinbase stock. However, before diving into those updates, let’s take a closer look at the trend of bitcoin miners turning to convertible note issuances to raise capital.
Last month, Bitdeer announced a $360 million convertible senior notes offering. Following suit, Marathon Digital, Core Scientific, and Iris Energy initiated convertible notes offerings last week, totaling $850 million, $550 million, and $400 million respectively.
According to data from TheMinerMag, seven publicly traded BTC miners and data center companies have collectively raised $5.2 billion through convertible notes since June. A significant portion of this amount, approximately 70%, was raised in the last four weeks alone.
It’s worth noting that the aforementioned figure doesn’t include Riot Platforms’ recent proposal for a $500 million convertible notes offering on Monday.
Nishant Sharma, founder of BlocksBridge Consulting, believes that these capital raises reflect mining firms taking advantage of the growing bullish sentiment surrounding bitcoin among institutional investors. He predicts that this trend will persist as we are still in the early stages of a new crypto bull run.
Bitdeer stated that the proceeds from its offering will be used for data center expansion, as well as the development and manufacturing of ASIC-based mining rigs.
Following a surge in its stock price, Benchmark’s Mark Palmer raised Bitdeer’s stock price target from $16 to $29. The rally was driven by the company’s increased SEALMINER A2 mining rig hashrate projection for 2025, from 18 exahash per second (EH/s) to 35 EH/s.
Marathon and Riot have expressed intentions to use the capital raised to acquire more BTC. Despite this, MARA and RIOT share prices have experienced some fluctuations over the past month.
Sharma believes that Marathon could potentially emulate MicroStrategy’s approach, given the latter’s success in accumulating bitcoin. He also highlighted CleanSpark as a company that could take decisive actions in both mining and holding bitcoin.
Marathon currently holds 34,959 BTC, while CleanSpark and Hut 8 Mining own 9,297 BTC and 9,122 BTC respectively. Hut 8 Mining plans to use proceeds from its recent at-the-market (ATM) and stock repurchase programs to purchase more bitcoin as a strategic reserve asset.
In other news, MicroStrategy has acquired an additional 21,550 bitcoins, bringing its total holdings to 423,650 BTC. This purchase amounted to approximately $2.1 billion in cash.
Despite these developments, MSTR stock was down over 4% at 2 pm ET on the same day, mirroring the slight decline in BTC price.
On the stock market front, Coinbase saw a 7% decrease in share price on Monday, settling at around $318. However, Needham analysts John Todaro and Brian Vieten raised their price target for COIN from $375 to $420. They noted that the crypto exchange is on track to have its best volume month since May 2021.