Publicly traded Bitcoin mining firm Riot Blockchain has recently acquired more Bitcoin after raising $525 million through a private senior convertible notes offering. The company had previously announced its plan to raise funds from private investors in order to purchase Bitcoin and cover other general corporate expenses.
In its most recent announcement on Friday, Riot, based in Castle Rock, Colorado, revealed that it had purchased 5,117 Bitcoin (BTC) at an average price of $99,669 per coin, including fees. This resulted in a total expenditure of $510 million.
With this recent acquisition, the company now holds 16,728 BTC, which is currently valued at approximately $1.69 billion. As of the time of writing, Bitcoin is being traded at $101,170, according to CoinGecko.
Riot, along with other major Bitcoin miners, is following the lead of software company MicroStrategy. MicroStrategy was the first to invest in Bitcoin in 2020 during the COVID-19 pandemic, aiming to generate optimal returns for its shareholders. This strategy of holding Bitcoin as a treasury reserve has now been adopted by companies of various sizes.
MicroStrategy presently utilizes private offerings and debt to acquire more Bitcoin, mainly focusing on securitizing the asset. This allows investors to purchase shares of the company and gain exposure to Bitcoin. MicroStrategy currently holds 423,650 BTC, valued at nearly $43 billion, and encourages other companies to invest in Bitcoin as a hedge against inflation.
Other prominent American Bitcoin miners are also adopting this strategy to strengthen their financial positions. For instance, Marathon Digital Holdings, formerly known as Marathon Patent Group, announced on Tuesday that it had purchased 11,774 Bitcoin for $1.1 billion, with an average price of $96,000 per coin.
Edited by Andrew Hayward.