Why investors are lending MicroStrategy billions of dollars at 0% interest so it can buy bitcoin
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Investors are lending MicroStrategy billions at 0% interest to buy bitcoin. Convertible-bond investors stand to gain if bitcoin's value increases, but can reclaim their money early if it decreases.
January 14, 2025 | 9:45 pm
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MicroStrategy is borrowing billions at 0% interest to invest in bitcoin. This strategy could benefit convertible-bond investors if bitcoin's value increases, but they have the option to withdraw early if it decreases.
MicroStrategy's strategy to borrow at 0% interest to invest in bitcoin is a high-risk, high-reward move. If bitcoin's value increases, the company's stock could see a positive impact. However, the option for investors to withdraw early if bitcoin's value decreases provides a safety net, making this a significant development for MSTR's stock price.
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