Fold Unlocks 521 BTC After Paying Off $66M Debt

Fold has eliminated $66.3 million in convertible debt and released 521 Bitcoin that had been pledged as collateral, strengthening its balance sheet as it prepares to expand its product lineup.

Key Takeaways

• Fold retired $66.3 million in convertible notes, removing potential shareholder dilution.
• The company freed 521 BTC that had been locked as collateral against the debt.
• Fold says the move improves liquidity flexibility and reduces financing constraints.
• A consumer Bitcoin rewards credit card is among its near term growth priorities.

What Happened?

Fold, a Nasdaq listed Bitcoin financial services company, announced it has fully repaid two outstanding convertible notes totaling $66.3 million. These debt instruments could have been converted into equity at a later date, potentially increasing the company’s share count.

By paying off the notes in full, Fold removed the risk of future dilution and unlocked 521 Bitcoin that had been pledged as collateral. The company said the restructuring gives it greater flexibility as it pushes forward with expansion plans.

Fold Strengthens Its Balance Sheet

Convertible notes are commonly used by growth companies because they allow debt to convert into shares later. However, that conversion can dilute existing shareholders. By retiring the two notes, Fold has simplified its capital structure and eliminated that overhang.

The company also confirmed that the 521 Bitcoin previously tied to the debt are no longer encumbered. Those holdings can now be used for corporate purposes, including product development and broader strategic initiatives.

According to the company, the restructuring reduces financing restrictions and increases liquidity flexibility. That added flexibility comes at a time when Fold is looking to grow its footprint in the competitive crypto rewards space.

Fold went public on Nasdaq in February 2025 through a SPAC merger with FTAC Emerald Acquisition. It became one of the first Bitcoin focused financial services companies to trade on a major United States exchange. Since its debut, however, Fold shares have fallen more than 84 percent.

Focus Shifts to Bitcoin Rewards Credit Card

One of Fold’s near term priorities is launching a consumer facing Bitcoin rewards credit card. Unlike traditional credit cards that offer cashback or points, Fold’s product aims to reward users directly in Bitcoin.

The company originally built its brand around a debit card that allows customers to spend United States dollars while earning Bitcoin on everyday purchases. Over time, it expanded into savings features and merchant partnerships designed to encourage Bitcoin accumulation rather than direct crypto spending.

By unlocking its Bitcoin collateral and removing debt related constraints, Fold appears to be positioning itself to double down on product innovation.

Competition Heats Up in Crypto Card Market

Fold is not alone in targeting crypto users for everyday spending.

The Coinbase Card allows users to spend cryptocurrency balances directly and earn crypto rewards on purchases. It forms part of Coinbase’s broader super app strategy, which aims to combine payments, trading, and financial services into a single ecosystem.

The Nexo Card lets customers borrow against crypto holdings to make purchases without selling their assets, while still earning rewards. Bybit and Crypto.com each offer Visa branded cards that provide cashback in platform native tokens.

More recently, Mastercard and MetaMask launched a United States crypto linked card that converts digital assets to fiat at the point of sale, allowing users to spend crypto anywhere Mastercard is accepted.

The growing number of entrants shows that companies see strong demand among crypto holders for practical spending tools. Everyday payments are becoming a new battleground for digital asset firms seeking recurring engagement and transaction volume.

CoinLaw’s Takeaway

In my experience, clearing debt before launching new products is often a smart move. I see this as Fold trying to clean up its balance sheet and remove uncertainty before pushing harder into the credit card market. Freeing up 521 Bitcoin is not just symbolic, it strengthens liquidity and sends a signal that the company wants more control over its capital structure.

That said, with shares down more than 84 percent since going public, execution will matter more than announcements. If Fold can deliver a compelling Bitcoin rewards credit card that stands out in a crowded field, this restructuring could mark a turning point.

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