(Reuters) -Trump Media and Technology Group will raise about $2.5 billion to invest in bitcoin, U.S. President Donald Trump's social media company said on Tuesday, as it looks to diversify its revenue.

The company is raising the funds by selling $1.5 billion in stock at its last closing price and $1 billion in convertible notes priced at a 35% premium, it said in a statement.

The bitcoin will be held on Trump Media's balance sheet alongside existing cash and short-term investments totaling $759 million as of the end of the first quarter. Crypto platforms Anchorage Digital and Crypto.com will provide custody for the bitcoin holdings.

"We view bitcoin as an apex instrument of financial freedom," Trump Media CEO Devin Nunes said, hailing the move as a "big step forward" in the company's plan to acquire "crown jewel assets consistent with America First principles."

Shares of the company behind Truth Social, a streaming and social media platform, were down 8%.

The move is part of a recent trend of public companies adding bitcoin and other cryptocurrencies to their balance sheets to capitalize on rising token prices as the Trump administration embraces digital assets.

Strategy - formerly known as MicroStrategy - has long been an aggressive investor in bitcoin and saw its shares soar more than six-fold last year, taking its market value to almost $94 billion. The company held $23.91 billion in crypto assets at the end of 2024.

Several other companies have tried to replicate Strategy's success, including GameStop and several biotech firms.

Last month, Cantor Fitzgerald announced that it would team up with Tether and SoftBank Group to launch Twenty One Capital, a bitcoin-buying entity that formed from a merger with blank-check vehicle Cantor Equity Partners. The combined vehicle is valued at $3.6 billion.

Trump Media has been exploring potential mergers and acquisitions as it aims to diversify into financial services.

Last month, it reached a binding agreement to launch various retail investment products, including crypto and exchange-traded funds aligned with Trump's policies.

The Trump family, long rooted in skyscrapers and country clubs, has opened multiple beachheads in crypto, quickly gaining hundreds of millions of dollars. Those other crypto forays include Trump NFTs, a meme coin, a stake in a newly formed bitcoin producer called American Bitcoin and World Liberty Financial, a decentralized crypto platform that also offers a stablecoin pegged to the U.S. dollar.

But the crypto push has attracted scrutiny from lawmakers, including Democratic Senator Elizabeth Warren, who last month asked the U.S. securities regulator about its plans to supervise ETFs due to be launched by Trump Media.

(Reporting by Aditya Soni and Arsheeya Bajwa in Bengaluru and Hannah Lang in New York; Editing by Shilpi Majumdar and Rod Nickel)