Trading volumes on this index reached $70 billion on Nov. 21. While ETFs like BlackRock’s iShares Bitcoin Trust attracted billions in inflows, MicroStrategy raised $3 billion to expand its Bitcoin holdings despite a sharp drop in its stock price. Similarly, MARA Holdings issued $1 billion in convertible notes for its own Bitcoin acquisitions. Meanwhile, Coinbase faced backlash over its decision to delist Wrapped Bitcoin (wBTC). Accusations suggest that Coinbase decided to delist wBTC to promote its own Bitcoin wrapper, cbBTC.
Bitcoin Rally Sparks Record Trading
The trading volumes of the "Bitcoin Industrial Complex," which includes U.S. spot Bitcoin ETFs and stocks like MicroStrategy (MSTR) and Coinbase (COIN), soared to a record-breaking $70 billion on Nov. 21 as Bitcoin rallied to an all-time high. This new peak shattered the previous record of $55 billion that was set just a day before. Bloomberg ETF analyst Eric Balchunas described the surge as “BITSANITY.”
MicroStrategy played a big role in the day’s trading frenzy because it accounted for the largest share of trading volume. However, its stock experienced a sharp drop and closed at $397.28. Bitcoin’s latest price milestone, however, puts it within striking distance of the $100,000 threshold, which is a major psychological level that could drive further market activity.
The record trading volumes also coincide with the rapid growth of U.S. spot Bitcoin ETFs, which have now amassed more than $100 billion in assets under management. Inflows into these funds reached $29.3 billion since their approval in January, with the BlackRock-issued iShares Bitcoin Trust ETF (IBIT) leading the charge at $30.2 billion. The Fidelity Wise Origin Bitcoin Fund and ARK 21Shares Bitcoin ETF follow with $11.2 billion and $2.7 billion in inflows, respectively.
Bitcoin ETF flow (Source: Farside Investors)
These inflows came at the expense of the Grayscale Bitcoin Trust, which saw over $20.2 billion in outflows. Balchunas pointed out that U.S. Bitcoin ETFs now hold assets equivalent to 82% of the gold ETFs, which is a remarkable feat considering gold has been present in the market since 2004.
Additionally, options contracts for BlackRock's IBIT launched on Nov. 20, and traded close to $2 billion in total exposure. Bloomberg ETF analyst James Seyffart suggested that these impressive trading figures very likely played a role in Bitcoin's ascent past $94,000 earlier this week.
MicroStrategy Raises $3 Billion to Buy More Bitcoin
MicroStrategy successfully completed a $3 billion offering of 0% convertible senior notes due in December of 2029 to buy more Bitcoin. The business intelligence firm revealed the completion of the offering on Nov. 21, which was the same day its shares retraced by more than 25%, according to Google Finance data.
The convertible notes come with a 55% premium and an implied strike price of approximately $672, allowing holders the option to convert to MicroStrategy’s class A common stock at the predetermined price.
These notes, which do not pay regular interest, are sold at a discount and will mature to their full face value if not converted before the maturity date. As senior securities, they take precedence over common stock in the event of bankruptcy or liquidation. Should MicroStrategy decide to allocate the entire $3 billion to Bitcoin purchases, it could buy about 30,600 BTC at current prices.
This offering is part of MicroStrategy’s ambitious “21/21” plan to raise $42 billion over the next three years, equally split between equity and fixed-income securities, to increase its Bitcoin holdings. The company already owns 331,200 Bitcoin, which is valued at more than $32.7 billion. This makes it the largest corporate holder of Bitcoin.
Despite its strategic focus, MicroStrategy’s stock experienced a sharp decline from an intraday high of $536.7 to $397.28 by the closing on Nov. 21. The drop happened after a report from Citron Research revealed a hedged short position on MSTR, which suggests that the stock’s performance outpaced Bitcoin fundamentals. The report also warned that it may be overheated. However, MSTR is still one of the best-performing stocks in the U.S. market this year, and boasts a 480% gain year-to-date.
Mara Holdings Also Raises $1 Billion for Bitcoin Acquisitions
MicroStrategy is certainly not the only company prioritizing stocking up on Bitcoin. Mara Holdings completed a $1 billion issuance of zero-coupon convertible senior notes due March 1 of 2030, to boost its Bitcoin acquisitions and address debt obligations. Issued under Rule 144A of the Securities Act of 1933, these notes feature a conversion price much higher than the company’s recent stock value and can be redeemed under favorable conditions starting in 2028.
About $199 million of the proceeds will be allocated to repurchasing $212 million of convertible notes due in 2026. The remaining funds will support Bitcoin purchases, strategic investments, and operational growth.
The move is very similar to MicroStrategy’s recent $2.6 billion note issuance for Bitcoin acquisitions. It also proves that both MicroStrategy and MARA Holdings are confident in Bitcoin’s potential to reach $100,000.
Mara’s notes carry an initial conversion price of $25.91 per share, representing a 42.5% premium over the average trading price before the offering. This ambitious financing strategy aligns with CEO Fred Thiel’s optimism about the industry’s growth under a Trump administration, which he believes will create a much more favorable environment for Bitcoin mining.
Despite these plans, Mara’s Q3 earnings report that was released on Nov. 12 fell short of expectations, and showed a $0.34 per share loss. It also triggered a 9.1% dip in after-hours trading. While revenue increased 34.5% year-over-year to $131.6 million, it still missed the analysts’ forecast of $148.1 million. However, on Nov. 11, Mara’s stock surged by 30% as Bitcoin approached $90,000, which contributed to a 10% year-to-date increase in the company’s share price.
This financial momentum, coupled with the company’s aggressive Bitcoin acquisition strategy proves that MARA Holdings is making it a top priority to capitalize on the crypto’s bullish trajectory.
Controversy Erupts Over Coinbase’s wBTC Delisting
Tensions in the crypto industry are rising after BiT Global accused Coinbase of delisting Wrapped Bitcoin (wBTC) to promote its own Bitcoin wrapper, Coinbase Wrapped BTC (cbBTC). According to BiT Global, Coinbase’s decision is an attempt to eliminate competition and boost cbBTC’s market presence.
Coinbase, however, denied these allegations, and stated that the delisting decision was made after a routine review of wBTC’s compliance with its listing standards. The exchange announced on Nov. 19 that trading for wBTC will be suspended starting Dec. 19 of 2024.
A Coinbase spokesperson also clarified that each asset is reviewed independently and that the decision was unrelated to cbBTC. Coinbase only facilitates wBTC trades through limit orders. Bitcoin wrappers like wBTC and cbBTC represent Bitcoin on other blockchain networks, allowing for interoperability and expanded use cases.
BiT Global criticized Coinbase’s move, and claimed it deprives investors of the freedom to choose between Bitcoin wrappers. The controversy followed BitGo’s August decision to grant BiT Global partial control of the multisignature wallet backing wBTC. Unfortunately, this move drew a lot of scrutiny because of concerns about Justin Sun’s involvement.
wBTC TVL (Source: DefiLlama)
Despite the delisting, wBTC is still the dominant Bitcoin wrapper, with over $14 billion in total value locked (TVL), according to DefiLlama. In contrast, Coinbase’s cbBTC that was launched on Sept. 12, amassed about $1.5 billion in TVL, according to CoinMarketCap.
