Bitcoin treasury shares fell on Thursday after The Smarter Web Company completed an accelerated bookbuild raising approximately £41.2 million, significantly exceeding its £30 million target.
The firm issued 14.2 million new shares at 290p each through institutional investors via Tennyson Securities and Peterhouse.
The company plans to use the funds for organic growth around existing services and an acquisition strategy to accelerate scale. It will also use the cash to fund further bitcoin purchases.
Today’s placing follows a series of fundraising efforts by the company, including a recent issue of shares at 495p that raised £3.8 million.
The Smarter Web Company shares were trading at 255p at the time of writing, below the accelerated bookbuild price of 290p and around 50% below recent highs of 500p.
The decline in The Smarter Web Company shares sparked a wave of selling across companies that have raced to adopt Bitcoin treasuries after Smarter Web blazed a trail following their recent IPO.
Vinanz, Pri0r1ty Intelligence, Sundae Bar, TAO Alpha, GSTechnologies, Cel AI, and Cykel AI were all down heavily on Thursday.
When helium and metals exploration companies such as Mendell Helium and Panther Metals announce they are adopting Bitcoin treasury policies, you have to question the motivations behind the decisions to diversify their balance sheets into cryptocurrency and whether some of the sharp share price gains recorded after announcing BTC treasuries are justified. Time will tell.
Incidentally, Mendell Helium was a cannabis company up until last year and has made the remarkable pivot from a company focused on cannabis and hemp to a helium explorer with a Bitcoin treasury. The company hasn’t announced meaningful revenues from either the cannabis or helium businesses.
With Bitcoin prices remaining steady at around $100,000, the companies that have adopted a Bitcoin treasury in recent weeks have yet to make any material gains from their Bitcoin purchases.
Many of the companies adopting Bitcoin treasuries are still working towards achieving steady revenue streams and will require cash to fund operations. They will be quids in if the Bitcoin price rallies, but their growth plans could be curtailed if the price falls.