A company named Treasury, which specializes in Euro-denominated Bitcoin holdings, has successfully raised an impressive 126 million euros (approximately $147 million) in a private funding round. This effort was primarily backed by Winklevoss Capital alongside Nakamoto Holdings. In a recent announcement, Treasury indicated that it has already utilized a chunk of this funding to acquire over 1,000 Bitcoin (BTC), marking a significant step in establishing its Bitcoin treasury.
Treasury aims to become the first Bitcoin treasury firm to be publicly listed on a primary European exchange. In pursuit of this goal, the company intends to achieve a listing on the Euronext Amsterdam stock exchange. This will be accomplished through a reverse listing strategy by merging with MKB Nedsense, a lender. This method allows private companies to bypass certain listing prerequisites by merging with companies that are already publicly traded.
Khing Oei, the founder and CEO of Treasury, stated that the company plans to leverage both future equity issuance and convertible debt as strategies to bolster its Bitcoin holdings. The company intends to adopt a model where both equity and debt are employed to accumulate Bitcoin, positioning this cryptocurrency as its primary reserve asset.
In terms of corporate Bitcoin holdings across Europe, Treasury’s initial purchase positions it among the continent’s significant Bitcoin investors. Notably, Bitcoin Group, a German firm, currently leads with 3,605 BTC, valued at around $400 million. Other prominent corporate holders include French firm Sequans Communications with 3,205 BTC worth approximately $356 million, and The Smarter Web Company from the UK, which holds 2,440 BTC, valued at about $270 million. The landscape for Bitcoin treasury firms in Europe is expanding rapidly, as companies like Dutch cryptocurrency service provider Amdax are also preparing to establish their own Bitcoin treasury entities on the Amsterdam Euronext stock exchange.
However, despite the growing interest in Bitcoin treasuries, the model is not without its challenges and criticisms. A report by venture capital firm Breed has expressed concerns that many of these companies may struggle to sustain themselves, potentially facing a “death spiral” that could negatively impact those trading too closely to their net asset values.
Oei has acknowledged the risks associated with excessive leverage in the industry. He emphasized that Treasury monitors leverage percentages among competitors and plans to maintain a strategy that includes lower levels of leverage compared to others in the market. This cautious approach comes in light of insights shared by industry experts, including Josip Rupena, the CEO of lending platform Milo, who has likened the risks posed by these crypto treasury firms to those of collateralized debt obligations that were central to the 2007-2008 financial crisis.
As the sector evolves, it remains to be seen how Treasury and its peers will navigate the complex landscape of Bitcoin holdings and investment strategies.
