The convertible senior notes issued by MicroStrategy, due in 2027, will be redeemed for $1.05 billion. According to the official statement, noteholders have until February 24 to redeem their notes at 100% of the initial amount.

Another option is to convert each $1,000 bundle of notes into Class A MicroStrategy stock, valued at about $142 per share. The firm’s announcement follows reports that it may be required to pay taxes on $19 billion in unrealized Bitcoin earnings under the Inflation Reduction Act 2022’s Corporate Alternative Minimum Tax.

Impact of MicroStrategy’s Redemption Announcement on The Market

MicroStrategy (MSTR) shares fell 5.2% in the last 24 hours and, as of this writing, trade at $353.67, per on-chain data. With its solid financial sheet and strong shareholder support, the $93.12 billion valued corporation is unlikely to experience significant volatility.

Notably, the MicroStrategy stock has risen by 650% in the last year, and the company revealed a Bitcoin yield of 1.69% for 2025. Due to its outstanding stock market performance, MicroStrategy has attracted more investors who are prepared to purchase its drastically reduced shares.

The company’s shareholders accepted a proposed amendment earlier this week to increase the number of its Class A common stocks from 330 million to roughly 10.3 billion. TThismove showed that the stock was attracting the attention of major investors and international central banks.

A Broader Perspective

MicroStrategy has consistently advocated for all corporations to adopt a Bitcoin strategy as long-term insurance. Over the past two years, the company’s success has persuaded numerous other enterprises to adopt the same strategy, resulting in approximately 3.01 million BTC being retained in their treasuries.

Among the prominent companies possessing Bitcoin are MARA Holdings, Tesla Inc., Riot Platforms, Canaan Inc., Semler Scientific, and Metaplanet Inc. MicroStrategy will likely continue accumulating Bitcoin, particularly during Donald Trump’s administration.

The administration of President Trump has already started multiple projects that focus on the responsible adoption of cryptocurrency assets.

Potential Challenges for MicroStrategy and Others

Taxing unrealized profits may discourage investments and cause problems for businesses like MicroStrategy, which has embraced a Bitcoin treasury strategy to maintain its purchasing power. Coinbase and MicroStrategy delivered a letter opposing the Corporate Alternative Minimum Tax (CAMT) to the US Internal Revenue Service (IRS) on January 2.

The joint letter stated that a surprising combination of CAMT and a recently promulgated accounting standard creates unfair and unexpected tax consequences. In January 2025, MicroStrategy’s Bitcoin holdings exceeded 450,000, making it the world’s largest corporate BTC holder.

The SaylorTracker website notes that the company is up almost 68% on its investment and presently owns 461,000 BTC, worth about $49 billion. According to David Krause, a professor of finance at Marquette University, the business intelligence vendor’s BTC acquisition strategy may reduce shareholder equity.

The professor cautioned that abrupt declines in the Bitcoin price would make it more difficult for MicroStrategy to repay its debts and perhaps result in bankruptcy.

MicroStrategy Purchase 11,000 BTC

The business intelligence vendor’s most recent Bitcoin purchase is the company’s most significant transaction in 2025 and its third acquisition in January. The acquisition cost $1.1 billion in cash at a mean price of roughly $101,191 per BTC.

The purchase was made from January 13 to January 20, the week before US President Donald Trump’s inauguration. Like earlier MicroStrategy Bitcoin purchases, the acquisitions were funded by the revenues from issuing and selling shares using a convertible notes sales arrangement.

In an X post announcing the acquisition, MicroStrategy co-founder Michael Saylor stated that the business now owns 461,000 Bitcoin, which it purchased for $29.3 billion at an average price of $63,610. Saylor previously hinted at a possible purchase on January 19, which typically means that a Bitcoin purchase is imminent the following day.

Saylor has expressed his support for a US BTC strategy reserve, which industry participants expect President Trump to implement during his administration.