MicroStrategy has issued a redemption notice for its 2027 convertible senior note tranche, valued at $1.05 billion.
Earlier today, January 25th, the company announced that all conversion requests for this offering will be settled.Â
MicroStrategy Redeems $1.05 Billion Convertible Notes
Note-holders have until February 24 to redeem their securities at 100% of the principal amount or convert their holdings to Class A MicroStrategy stock. Each $1,000 block of notes can be converted into shares at a price of approximately $142 per share.
This announcement coincides with growing concerns about a potential tax bill on $19 billion in unrealized capital gains. The Corporate Alternative Minimum Tax (CAMT), introduced under the Inflation Reduction Act of 2022, has sparked debates about its implications for businesses with significant investments in digital assets.
Mixed Reactions from Market Participants
The redemption notice has triggered a wave of discussions in the market. While some see it as a strategic move by MicroStrategy to manage its financial obligations, others remain focused on the broader implications of unrealized capital gains taxes.
Critics argue that taxing unrealized gains, particularly in volatile markets like cryptocurrencies, discourages investment and creates undue burdens on companies.
Digital assets are especially sensitive to these taxes due to their fluctuating valuations. For firms like MicroStrategy, which has adopted Bitcoin as a treasury strategy, such tax policies could pose significant challenges.
MicroStrategy’s Bitcoin Strategy
Despite these headwinds, MicroStrategy continues its aggressive Bitcoin acquisition strategy. On January 21, the company disclosed a new purchase of 11,000 BTC for nearly $1.1 billion. The company’s total Bitcoin investment now stands at approximately $29.3 billion, with an average acquisition cost of $63,610 per Bitcoin.
This latest acquisition highlights MicroStrategy’s commitment to Bitcoin as a store of value and a hedge against inflation. The firm has achieved a Bitcoin yield of 1.69% so far in 2025, underscoring its confidence in the long-term potential of the asset.
Opposition to Corporate Alternative Minimum Tax
On January 2, MicroStrategy and Coinbase sent a joint letter to the U.S. Internal Revenue Service (IRS) opposing the CAMT. The letter outlined concerns about the “unjust and unintended tax consequences” arising from the combination of CAMT and newly introduced accounting standards.
The companies argued that these measures could create significant financial strain on businesses, particularly those with substantial investments in digital assets.
They emphasized the need for clear regulatory frameworks that support innovation without imposing excessive tax burdens.
MicroStrategy’s latest moves underscore its dual focus on managing financial obligations and expanding its Bitcoin treasury. However, the intersection of regulatory challenges and market volatility adds layers of complexity to its strategy.
Also Read: Polymarket Bets Forecasts 64% Chance of MicroStrategy Holding 500k+ Bitcoin Before March