MicroStrategy Could Sell Bitcoin to Fund Note Buybacks

MicroStrategy agreed on May 15 to repurchase roughly $1.5 billion principal of its 2029 convertible notes for about $1.38 billion in cash, according to a Form 8-K. The company expects to cancel the repurchased notes and have about $1.5 billion of the 2029 series remaining outstanding.

The filing lists available cash, at-the-market securities-sale proceeds and proceeds from Bitcoin sales as possible funding sources for the repurchase. The company’s quarterly 10-Q already states management may sell Bitcoin to satisfy liquidity needs even when other sources are available.

Convertible-note holders have scheduled put dates that allow them to require cash repurchases at 100% of principal plus accrued interest. The earliest put date is Sept. 15, 2027, when $1.01 billion of 2028 notes become putable. On March 1, 2028, $2.0 billion of 2030B notes face put rights. The June 1, 2028, date carries roughly $1.5 billion of 2029 notes after the current buyback. Additional put dates include Sept. 15, 2028, with about $1.4 billion of 2030A and 2031 notes, and June 15, 2029, with $800 million of 2032 notes.

After the planned repurchase closes, total put exposure through June 2029 would be about $6.71 billion, equivalent to roughly 84,900 BTC at a Bitcoin price near $79,000.

At a Bitcoin price near $79,000, using Bitcoin proceeds to fund the current $1.38 billion buyback would require about 17,448 BTC, or roughly 2.1% of MicroStrategy’s approximately 818,000 BTC holdings. That hypothetical sale would equal about 3.5% of a 24-hour Bitcoin trading volume near $39.5 billion. Routing large trades through institutional over-the-counter desks and smart-routing tools can reduce immediate exchange-visible effects, though counterparty hedging and trading behavior can still affect market prices.

MicroStrategy reported about $2.25 billion in dollar reserves as of April 26, which could fund the repurchase without monetizing Bitcoin. If the company uses cash and ATM proceeds and leaves Bitcoin untouched, the 2029 put exposure would fall by roughly $1.5 billion.

The Form 8-K and the 10-Q place Bitcoin explicitly on the list of instruments available for near-term liability management. Each put date gives noteholders an option to request cash repayment, and the company’s choice of funding source for any future repurchase will depend on market and financing conditions at that time.