Fold Eliminates $66.3M Convertible Debt, Unlocks 521 Bitcoin to Fuel Expansion

Fold, the publicly traded Bitcoin financial services provider, has successfully retired $66.3 million in convertible debt, a strategic move that eliminates potential shareholder dilution and strengthens its financial position ahead of planned product launches.

According to a recent company disclosure, Fold paid off two outstanding convertible notes—debt instruments that carry the option to convert into equity. By extinguishing this debt, the company has removed the risk of future share issuance that could have diluted existing equity holders.

Bitcoin Collateral Released for Corporate Use

As part of the debt retirement, Fold has also freed 521 Bitcoin (BTC) that had been held as collateral. With the notes now settled, these Bitcoin holdings are no longer encumbered and are available for corporate deployment, providing the company with additional strategic optionality.

The restructuring leaves Fold with a cleaner balance sheet, fewer financing constraints, and increased operational flexibility. Management indicated that this newfound agility will support growth initiatives, particularly the launch of a consumer-focused Bitcoin rewards credit card designed to offer BTC incentives instead of traditional points or cash-back programs.

Public Market Debut and Strategic Positioning

Founded in 2019, Fold entered the public markets in February 2025 via a SPAC merger with FTAC Emerald Acquisition, listing on the Nasdaq. The transaction marked a milestone for the sector, positioning Fold as one of the first Bitcoin-centric financial services companies to trade on a major U.S. exchange.

Fold initially built its reputation as a Bitcoin rewards platform, offering a debit card that enables users to spend U.S. dollars while earning Bitcoin cashback on everyday transactions. The company has since broadened its offerings to include savings products and merchant partnerships, all aimed at facilitating Bitcoin accumulation rather than direct cryptocurrency spending.

Intensifying Competition in Crypto Rewards

The crypto rewards card market has become increasingly crowded, with multiple players vying for user attention and market share.

The Coinbase Card, for instance, allows users to spend cryptocurrency directly while earning crypto rewards. It now forms a key component of Coinbase's "super app" strategy unveiled last fall, which seeks to unify payments, trading, and financial services within a single platform.

Meanwhile, the Nexo Card offers a different value proposition: customers can borrow against their crypto assets to make purchases without liquidating holdings, all while earning rewards. Bybit and Crypto.com have introduced Visa-branded cards that provide cashback in platform-native crypto tokens.

More recently, Mastercard and MetaMask partnered to launch a U.S. crypto-linked card that enables users to spend digital assets at any Mastercard-accepting merchant, with cryptocurrency automatically converted to fiat currency at the point of sale.

Coinasity's Take

Fold's debt elimination and collateral release reflect a disciplined approach to capital management at a time when many crypto companies are still grappling with overleverage and liquidity challenges. By clearing $66.3 million in convertible notes and freeing 521 BTC, the company has positioned itself to compete more effectively in the rapidly maturing crypto rewards card space. With public market accountability and a strengthened balance sheet, Fold appears well-equipped to scale its Bitcoin rewards offerings, though success will ultimately depend on user adoption in an increasingly competitive landscape dominated by established players like Coinbase and Crypto.com.