Trump Media to Raise $2.5B to Buy Bitcoin for Treasury

Trump Media and Technology Group, the media outlet of US President Donald Trump, has announced plans to raise $2.5 billion to create a Bitcoin treasury. The Nasdaq-listed firm, under the ticker DJT, noted in a press release that it would raise the funds by employing the MicroStrategy playbook. Specifically, Trump Media has reached an agreement with 50 institutional investors to sell $1.5 billion of its common stock and $1 billion through its 0.00% convertible senior secured note, aggregating to around $2.5 billion. Trump Media to Buy Bitcoin The Tuesday release stated that the offering would last until May 29, pending customary closing conditions by the involved parties. Meanwhile, Trump Media would employ the proceeds from the offering to create a strategic Bitcoin reserve. Notably, Trump Media branded the strategy to buy Bitcoin “one of the largest Bitcoin treasury deals of any public firm,” stating that it brings to a conclusion its earlier announcement of an acquisition fund. The Trump-owned company will offer its common stocks worth $1.5 billion at the last market price and the $1 billion senior notes at a 35% premium convertible price. The proposed $2.5 billion acquisition would make Trump Media one of the largest publicly traded companies holding the pioneering cryptocurrency. At the current standings, it would sit fourth in the rankings, only behind MicroStrategy, Marathon Digital, and Twenty One Capital . Trump Media disclosed that Crypto.com and Anchorage Digital will custody its proposed Bitcoin Treasury. DJT Stock Falls Amid Investor Skepticism Trump Media is the operator of the Truth Social media platform, streaming platform Truth+, and decentralized finance platform Truth.Fi. Interestingly, its stock took a tumble on Tuesday following the recent announcement, contrary to the stock performances of other firms that have disclosed in the past that they were buying Bitcoin. DJT fell 6.65% to $24.01 after a double-digit rally in the premarket, as investors pulled their stakes in the company. Part of the skepticism comes from Trump Media’s strategy of neutralizing its shares to fund its Bitcoin Treasury business. Notably, the Financial Times reported yesterday that Trump’s media firm plans to raise $3 billion to buy Bitcoin. While it denied the speculation, today’s announcement confirms that the report had some element of truth. Growing Exposure to Bitcoin Meanwhile, Trump Media joins a constantly growing list of public and private companies buying Bitcoin for their treasuries. It also becomes the latest to adopt MicroStrategy’s playbook to acquire the pioneering cryptocurrency. Firms like Marathon Digital, Metaplanet, and the Blockchain Group have all taken to offering investors bonds to raise funds for more Bitcoin acquisition. Strategy recently raised $2.1 billion to increase its massive stash, buying 4,020 BTC ($427 million) yesterday. Notably, the strategy does not sit well with some prominent market users. John Arnold, the co-chair of Arnold Ventures, frowned at the new trend of public companies buying Bitcoin when exchange-traded funds (ETFs) exist. https://twitter.com/JohnArnoldFndtn/status/1927330973143707688