a day ago
SMALL CAP IDEA: Bitcoin treasury has moved from investment backwaters to the mainstream
'The dam has broken. Now we have to wait for the river level to settle.'
Malcolm Palle, chairman of Coinsilium, is describing what has been a frenetic four months in Bitcoin treasury, a new sector that has moved from the investment backwaters to the mainstream in that time.
In the process, it has attracted tens of millions of pounds during one of the longest-lived funding droughts in memory for would-be growth companies.
His comment is notable. Palle is a veteran of cryptocurrency, blockchain and Web3, and at the start of 2025, could not have imagined the bonanza we have just witnessed.
The Smarter Web Company has been at the vanguard, and at one point was valued at over £1billion. London BTC, Satsuma Technologies and Vaultz have been among the first movers.
Coinsilium has made a splash too, raising £17million in new funds, which it is actively investing in Bitcoin.
Before we go further, it is worth outlining the concept of Bitcoin treasury, particularly for those new to the sector. Put simply, a company holds traditional operating assets, but instead of keeping surplus cash on deposit or in short-term interest-bearing instruments, it invests in Bitcoin.
This allows it to benefit from the value gains seen in recent months as the cryptocurrency has edged towards an all-time high.
The drivers of this upward momentum include voracious demand from exchange-traded funds and retail investors, fuelled by distrust of fiat currencies susceptible to government and central bank manipulation.
Bitcoin also serves as an inflation hedge, thanks to its fixed supply of 21 million units.
Forecasts differ, but analysts see the price, currently around $120,000, climbing to $200,000 next year. Ark Invest's Cathie Wood, the veteran investor and crypto bull, believes it could reach $1 million within five years.
'I don't disagree with the $200,000 number. It might even be conservative,' says Palle. 'But I don't see it being a linear ride. I can see some volatility. We could get to $200,000 and drop back quite markedly.'
The US has set the pace for Bitcoin treasury, with companies such as Strategy (formerly MicroStrategy), Mara Holdings and Twenty One Capital holding tens of billions of dollars of crypto. Elon Musk's Tesla is also heavily invested.
US President Donald Trump's Genuis Act, while focused on stablecoin oversight, is likely to benefit the wider cryptocurrency market.
By providing regulatory clarity and drawing in institutional players, it could bolster Bitcoin's long-term prospects and strengthen its role in global finance, while offering a lift to other digital assets with defined use cases.
Here in the UK, Keir Starmer's Labour administration does not appear to have the same relish to embrace crypto that Rishi Sunak's Tory government displayed. The regulatory approach seems to ignore the issue and hope it goes away.
Nevertheless, there is demand from the Great British investing public. And for the less crypto-savvy, unfamiliar with the new trading platforms and the process of opening wallets, direct, traditional equity investment makes sense.
Hence the rise of SWC and, of course, Coinsilium.
Palle's company has created Forza! - a Gibraltar-based wholly owned subsidiary focused on Bitcoin treasury management, which to date has amassed 181.9596 Bitcoin. At current prices, that is worth just shy of $22 million.
Value accretion has occurred in months rather than years in a business area best described as 'nascent'.
The ability to seize the opportunity so quickly stems from the fact that Coinsilium, under Palle and his CEO Eddy Travia, has played a pioneering role in the sector for a decade. That accords them veteran status.
They have co-opted the help of James Van Straten, a senior analyst at CoinDesk and one of the UK's best-known crypto-commentators. He shares his expertise as a member of Coinsilium's advisory board.
Before moving so decisively into treasury, Coinsilium's stock-in-trade was helping nurture blockchain innovation, working with early-stage ventures and contributing to the evolution of decentralised technologies and digital finance.
Indeed, its current market capitalisation probably ascribes close to zero worth to its portfolio investments, which are quickly maturing and may provide an unexpected value kicker. Watch this space.
Looking ahead, Palle said Coinsilium may look to use its 'paper' to make accretive acquisitions that will help it generate more Bitcoin.
I point out that some of the company's contemporaries have also begun funding growth through Bitcoin-denominated loans. On this, Palle is tight-lipped.
But he makes this observation: 'We know there are a lot of opportunities. But we want the waters to calm and clear before doing what is right for us.'
