Riot spends $510M on Bitcoin at $99,669—smart move or peak FOMO?

Bitcoin mining company Riot Platforms is solidifying itself as a major player in the crypto market. Between December 10 and 12th, 2024, Riot has made a significant purchase of 5,117 Bitcoins for $510m. 

This major acquisition has brought up the company’s total holdings to 16,728.

Top BTC accumulators are reaping the benefits of the price rise after the asset hit $100k.

Riot Platforms purchased BTC at almost the market peak

Riot Platforms’ substantial purchase of 5,117 BTC reportedly averaged $99,669. It highlights the company’s strategic approach to capitalizing and monopolizing market trends.

The company successfully managed to position itself to potentially benefit from further price rise of the top crypto by market cap. Purchasing BTC is not an uncommon practice amongst the several Bitcoin mining companies as they utilize a segment of their mined Bitcoin for long-term investments.

Bitcoin mining company Riot Platforms announced that it purchased approximately 5,117 bitcoins at an average price of $99,669 between December 10 and December 12, 2024, with a total cost of approximately $510 million. As of December 12, 2024, Riot Platforms' total bitcoin…

— Wu Blockchain (@WuBlockchain) December 13, 2024

On December 10, BTC’s price rise became evident as it inched towards the record high of $100k. It consistently rose through the level in the next two days. BTC has maintained this psychological level at press time.

According to the SEC filing dated December 9, Riot raised $525 million through a debt offering for the purchase. The company issued “senior notes,” which are loans from investors that can be converted into Riot’s stock under specific conditions. These notes will need to be repaid by 2030 and come with a low interest rate of 0.75%.

Riot Platform’s consistent crypto acquisition has led its balance to surpass 12,000 BTC. As per Arkham Research, Riot has a portfolio value of $1.2 billion.

Bitcoin purchases have seen a rise in shareholder value while providing a competitive edge in the dynamic Bitcoin industry.

Crypto players enjoy high BTC value against cost

Bitcoin accumulation by Riot Platforms and other businesses is bearing fruits as the asset continues a bull run. Over the last year, the amount of Bitcoin held by well-known companies like Tesla, Coinbase Global, Marathon Digital Holdings, MicroStrategy, and others has risen dramatically.

MicroStrategy, for instance, holds the largest corporate Bitcoin treasury, which stands at a staggering 423,650 BTC. As per data by Bitcoin Treasuries, MSTR is enjoying around 1.68x returns on its BTC bet. The market return against cost is substantial. So far, the holdings have attracted significant attention. It is clear that the companies see Bitcoin as a long-term investment advocating dollar-cost averaging. BTC is now 42% of the company’s total market cap at the time of writing.

Mining company, Marathon Digital Holdings, follows next in line. While MicroStrategy is a key listed player in BTC accumulation, Marathon has reportedly amassed 40,435 Bitcoin. BTC is 51% of the market cap of Marathon as of Friday.

Meanwhile, Riot is placed third on the list with around 38% of its market cap dominated by Bitcoin. Tesla is next and it reportedly holds 9,720 Bitcoin, enjoying a 2.93x return on its purchases. If you recall, Tesla’s initial Bitcoin investment elicited mixed reactions, but the company has made money.

Among other businesses, Coinbase Global is the largest cryptocurrency exchange platform in the US. It is next on the list of top BTC purchasers already listed. The exchange holds 9,480 Bitcoin, enjoying a massive 8.24x return.

Riot Platforms’ recent Bitcoin purchase underlines the continued interest among individual investors and companies alike. As the highly volatile crypto market continues to expand and evolve, Bitcoin’s $100k mark is being considered a sign of maturity.

All the major players and newly established businesses will likely start following suit. Despite being subject to market risk, several businesses incorporate strategies into their portfolio in the drive to get exceptional returns. And Bitcoin remains the latest bet.

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