Riot Platforms shares dip despite $500 million Bitcoin acquisition strategy

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Despite announcing a strategic Bitcoin purchase plan, Riot Platforms’ shares fell nearly 10%.

At the market opening on Dec. 9, the miner stock dropped by 7.1% to $12.03, reflecting a broader decline in crypto-related equities such as Coinbase, Marathon Digital, and CleanSpark, as reported by Yahoo Finance.

This contrasts with the broader crypto market’s upward trend, where Bitcoin’s price rose by 0.33% in the past 24 hours to trade at $99,940 as of press time, according to CryptoSlate’s data. However, Riot’s last price was marked at the close of after-hours trading on Friday, while Bitcoin trades 24/7. The decline in crypto equities this morning reflects, in part, the price disparity created during weekend trading.

Bitcoin acquisition plans

Riot Platforms plans to raise $500 million through a convertible senior notes offering to fund Bitcoin acquisitions and other corporate needs.

According to a Dec. 9 statement, the company will privately offer these notes to institutional investors under Rule 144A of the 1933 Securities Act. Buyers will also have a three-day option to purchase up to $75 million in additional notes.

The notes are unsecured senior obligations and will mature on Jan. 15, 2030. However, starting Jan. 20, 2028, Riot may redeem some or all of the notes for cash, provided at least $50 million remains outstanding if only a partial redemption occurs. Upon maturity, noteholders can convert them into Riot’s common stock or a combination of cash and shares.

The company said it intends to use the proceeds to acquire additional Bitcoin for general corporate purposes.

Meanwhile, this fundraising strategy mirrors moves by Riot’s peers. Marathon Digital, for instance, recently announced plans to raise $700 million through a similar private offering. Like Riot, Marathon intends to use the proceeds to bolster its Bitcoin reserves and fund corporate initiatives.

Pierre Rochard, the company’s Vice President of Research, highlighted Riot’s capacity to bridge fixed-income investments with Bitcoin’s unique market conditions. He pointed to the firm’s strong operational metrics as a key competitive advantage, including a hashrate of 25 EH/s.

According to Bitcoin Treasuries data, Riot holds 11,425 BTC, making it the third-largest publicly traded corporate Bitcoin holder.

Meanwhile, this financing strategy aligns with similar moves made by prominent other mining rivals like Marathon Digital.

Earlier this month, Marathon Digital revealed plans to raise $700 million through a private offering of unsecured convertible senior notes due 2031. The firm stated that this fundraiser would acquire more Bitcoin and support general corporate activities.