Crypto Treasury Companies
Explore how crypto treasury companies raise capital and use warrants for institutional Bitcoin buying and the risks involved.
Crypto Treasury Companies Are Selling a Leveraged Route to Bitcoin Exposure
Capital B’s deal was a financing structure, not simply a Bitcoin purchase
French Euronext Growth-listed Capital B raised €21 million, or about $24.5 million, in a private placement on Aug. 28, with participation from Blockstream chief executive Adam Back and asset manager TOBAM. [5] The company said it intended to buy 270 Bitcoin and reach roughly 3,415 BTC. [5]
The immediate risk is that such transactions are often described as institutional Bitcoin buying when they are really equity-financing exercises with a Bitcoin use of proceeds. The eventual result depends not only on Bitcoin’s price, but on dilution, the company’s share price and whether warrants become valuable enough to exercise.
Capital B sold 36,219,070 shares at €0.58 each, a 6.45% discount to its preceding closing price, according to Bitcoin Magazine’s report. After fees and transaction costs, the company expected net proceeds of approximately €19.9 million. That gap is the first cost of the transaction. [5]
The offered security was an ABSA, a French capital-markets structure meaning a share issued with attached subscription warrants. Each investor received one ordinary share plus four warrants, which can later be used to subscribe for additional ordinary shares under predetermined terms.
That combination is the central mechanic in the current treasury-company model. A company receives an initial cash injection at a discounted share price, then offers investors a potential second payout if the shares trade above the warrants’ exercise prices.
How a warrant-funded Bitcoin treasury works
A warrant is not a share and does not initially give the holder ordinary shareholder rights. It is an option issued by the company, allowing its holder to buy newly issued shares at a set exercise price before an expiry date.
Consider the simplified version of Capital B’s arrangement. An institution buys one €0.58 share and receives four warrants. Capital B receives the €0.58 immediately, minus transaction costs, and can deploy the proceeds toward Bitcoin purchases.
If Capital B’s ordinary shares later rise above a warrant’s exercise price, exercising may be economically rational. The warrant holder pays the exercise price to Capital B, receives a newly issued share, and can keep or sell that share.
For Capital B, each exercised warrant supplies more capital. The company said full exercise of its warrants could generate a further €135.8 million, or about $158 million, through the issuance of 144,876,280 ordinary shares. [5]
That prospective €135.8 million is not cash in the bank. It is contingent financing, dependent on the warrants being exercised. It should therefore be treated differently from the €21 million placement proceeds, which Capital B had already raised. [5]
The available reporting does not disclose all individual warrant exercise prices or their complete expiry terms. It notes different exercise-price levels, but those missing details matter because they determine whether each warrant is likely to be exercised. [5]
Capital B retains a tool to accelerate the decision. The company said it could trigger an accelerated exercise period when its 20-day volume-weighted average share price exceeds 130% of the relevant warrant tranche’s exercise price. [5]
A volume-weighted average price, or VWAP, measures the average price at which shares traded over a period, weighted by the number of shares traded at each price. It is harder to influence with a single thinly traded transaction than a one-day closing price.
The 130% threshold is intended to indicate that warrants are sufficiently in the money. If a warrant permits an investor to buy at €1 and the sustained VWAP exceeds €1.30, the investor has an apparent economic incentive to exercise.
But acceleration also creates pressure. Investors must decide whether to contribute new money, sell warrants, or allow them to lapse. The company is effectively asking them to fund another Bitcoin purchase cycle, while accepting that their new shares will dilute existing holders.
The trade-off is dilution against Bitcoin per share
The important measure is not merely the total number of Bitcoin a company owns. It is how much Bitcoin backs each share after accounting for new equity, debt, preferred securities, operating liabilities and the share count created by exercised warrants.
If a treasury company raises cash at a high market valuation, it can issue relatively few new shares to buy more Bitcoin. Existing shareholders may benefit if Bitcoin acquired per newly issued share exceeds the dilution created by the offering.
If the company’s shares trade near or below the value of its Bitcoin holdings, the math changes. Issuing discounted common stock can dilute shareholders faster than the company increases Bitcoin per share, even if the nominal treasury balance rises.
This is why the premium to net asset value matters. CoinMarketCap reported that Strategy, the largest corporate Bitcoin holder, traded at a roughly 40% premium to the value of its Bitcoin holdings, a premium that can make equity issuance more attractive. [3]
A premium is not permanent and is not an assurance of better performance. It reflects investors assigning value to Strategy’s financing machinery, management, liquidity and potential Bitcoin accumulation, while also accepting leverage and corporate-risk exposure.
Strategy held 843,706 BTC as of Aug. 28, far more than any other public treasury company in the research brief. [3] Yet it also carried about $11 billion in debt, highlighting why a large Bitcoin balance does not eliminate balance-sheet stress. [3]
The company reportedly sold 32 BTC in June 2026, an unusual reversal for a business identified with persistent accumulation. [9] The sale does not prove a broader strategy change, but it shows that even the sector’s largest issuer can use Bitcoin liquidity when required.
Institutions are funding the structure, not just the asset
Adam Back and TOBAM’s participation in Capital B’s placement illustrates the institutional role. They did not simply purchase Bitcoin on an exchange. They bought into a corporate financing instrument that combined immediate equity with potential follow-on warrant exposure. [5]
That distinction affects incentives. A direct Bitcoin buyer has exposure primarily to Bitcoin’s price and custody arrangements. A private-placement investor in Capital B also evaluates the company’s capital structure, trading liquidity, execution and ability to continue raising funds.
Capital B had earlier raised €15.2 million in May, issuing 23 million shares with four warrants attached to each share, according to the independent research brief. The repeat use of the structure suggests warrants are becoming a standing financing channel, rather than a one-off feature.
Other transactions show institutions operating across equity, acquisitions and debt repayment. Adam Back-backed Swedish treasury company H100 Group acquired Norway’s Moonshot and PDI on Aug. 10, adding 2,455.7 BTC and bringing its holdings to 3,506 BTC. [6]
Smarter Web provides the less favourable version of the same financing environment. The company sold 177.89 BTC in July to repay $11.69 million owed to TOBAM, while retaining 2,700 BTC. [7] Bitcoin can be a reserve asset, but it can also become the asset sold to meet debt obligations.
Nasdaq-listed Strive Asset Management, meanwhile, raised its Bitcoin balance above 21,000 BTC with a recent purchase, according to Intokened. [8] Its place among the larger treasury companies indicates that institutional participation is not limited to one issuer or one financing method.
Across public companies, concentrated holdings create a liquidity issue. The research brief estimates 199 public companies hold about 1.264 million BTC, valued near $79 billion. A concentrated asset base can become difficult to liquidate efficiently during a period of falling prices and stressed equity markets.
Preferred stock shifts risk, rather than making it disappear
New York Stock Exchange-listed education company Genius Group offers another financing model. It proposed parallel Bitcoin and artificial-intelligence treasuries worth a combined $1.6 billion, with total assets targeted at $2 billion by fiscal 2031. [3]
The proposal followed a much less ambitious reality. Genius Group had sold its remaining Bitcoin to eliminate $8.5 million in debt after its earlier treasury strategy ran into financing restrictions and falling crypto prices. [3]
The company now intends to use perpetual preferred securities under its $1.2 billion Securities and Exchange Commission-cleared shelf registration, beginning with a targeted $12.5 million raise. [3] Preferred securities generally sit ahead of common equity in dividend and liquidation claims.
For common shareholders, preferred financing can avoid immediate common-stock issuance. But the preferred dividend is a contractual-like cash burden in ordinary business conditions, and missed payments or refinancing problems can shift stress back onto common equity.
Genius Group said it planned to maintain cash covering roughly 18 months of preferred dividends. [3] Whether that reserve proves sufficient is speculative because it depends on dividend terms, operating cash flow, market conditions and its ability to raise fresh capital.
Bitcoin’s price is only one moving input
Bitcoin traded around $77,568 on Aug. 28 in the independent research brief. Other cited estimates varied: Bitcoin Magazine used $77,960, MoneyWeek reported nearly $79,000, and CoinGecko projected $80,114.49 for August 2026. [1][2][5]
Those differences are small relative to Bitcoin’s normal volatility, but they demonstrate why treasury-company valuations should not be anchored to a single quoted price. Bitcoin fell below $70,000 in February 2026, producing unrealised losses and share-price pressure across the sector. [4]
A treasury company’s stock can decline more sharply than Bitcoin because it combines Bitcoin-price sensitivity with funding risk. When its equity premium narrows, raising common stock becomes more dilutive, while lenders and preferred investors may demand more favourable terms.
European issuers face an additional operational question. The European Union’s Markets in Crypto-Assets regulation, effective July 1, 2026, brings governance, capital-reserve, internal-control and cybersecurity expectations to crypto platforms and related businesses.
Available research does not identify specific MiCA enforcement actions against Bitcoin treasury companies or quantify compliance costs. Still, the absence of a published number is not evidence of no cost, particularly for smaller issuers using repeated private placements.
Japan Bitcoin Industry’s Aurora product, announced at Bitcoin Asia in Hong Kong, illustrates a separate institutional route into Bitcoin infrastructure. It offers self-custodial Lightning payments for Japanese merchants selling anime, manga and games to overseas customers, rather than putting Bitcoin on a public-company balance sheet.
Aurora’s model leaves merchants receiving Bitcoin directly through their own Lightning nodes, while Japan Bitcoin Industry provides operational support including uptime, liquidity, accounting and conversion processes. That reduces reliance on a central custodian, but it does not turn a payments platform into a treasury-company investment.
Frequently Asked Questions
How do crypto treasury companies raise capital for Bitcoin purchases?
Crypto treasury companies raise capital primarily through equity financing, often by issuing discounted shares combined with attached warrants. For example, Capital B raised €21 million by selling shares at a discount with warrants that allow investors to buy additional shares later, providing immediate cash for Bitcoin purchases and potential future funding if warrants are exercised.
What are the risks of investing in bitcoin treasury companies?
Investors face several risks including Bitcoin price volatility, liquidity constraints, refinancing challenges, and share dilution. Additionally, owning shares in these companies means assuming corporate debt and operating costs, and the market price of shares may trade at a premium or discount relative to the underlying Bitcoin holdings.
How do warrants affect bitcoin treasury company financing?
Warrants give investors the option to buy additional shares at a set exercise price, potentially providing the company with more capital if exercised. However, if warrants are not exercised, the company does not receive the expected cash, and exercising warrants causes dilution of existing shareholders.
What is the difference between owning Bitcoin and owning shares in a treasury company?
Owning shares in a Bitcoin treasury company is not the same as owning Bitcoin directly. Shareholders are exposed to corporate risks such as debt, operating expenses, and dilution, and the share price may not always reflect the net value of the company’s Bitcoin holdings due to market premiums or discounts.
How does dilution impact shareholders in bitcoin treasury companies?
Dilution occurs when new shares are issued, such as through warrant exercises, which increases the total number of shares outstanding. This reduces existing shareholders’ ownership percentage and can affect the share price, potentially diminishing the value of their investment even if the company’s Bitcoin holdings increase.
How we researched this
This article was assembled from 4 published articles, 9 cited references.
Nothing here is based on hands-on testing. Where a figure or finding appears, it belongs to the source cited beside it, and the writing says so rather than implying otherwise. Every source is listed below so you can check it.
Sources
Capital B raises $24.5M for its Bitcoin treasury amid market uncertainty with BlockStream’s Adam Back chipping in — Cointelegraph
Capital B Raises €21M From Adam Back and TOBAM To Buy More BTC — Bitcoin Magazine
Genius Group Sets $2B Dual Treasury Target Months After Liquidating Bitcoin Holdings — Bitcoin Magazine
Japanese Bitcoin Industry Unveils ‘Aurora’ to Let Global Anime Fans Support $2 Trillion Yen Space — Bitcoin Magazine
Are Bitcoin Treasury Companies Losing Their Financing Edge in 2026? | CoinMarketCap
Crypto Treasury Firms Struggle as Bitcoin Slumps Below $70K | BanklessTimes
Capital B Raises $24.5M for Bitcoin Treasury With Blockstream CEO Adam Back on Aug. 28 | Gate US
Yet Another Corporate Bitcoin Sale: Smarter Web Repays $11.69M TOBAM Debt by Selling 178 BTC
Strategy, la empresa que más bitcoin tiene del mundo, empieza a vender sus reservas
Related Articles
Bitcoin-Backed Mortgages and Crypto Credit Lines Explained
Learn how Bitcoin-backed mortgages and crypto credit lines work, their collateral needs, risks, and custody details for U.S. borrowers.
Bitcoin ETF Institutional Investment Trends and Market
Explore Bitcoin ETF institutional investment trends, key products, and how institutions navigate crypto exposure and market risks.
Bitcoin Bull Market Signals and Price Rally Analysis
Explore Bitcoin bull market signals, ETF inflows, and price rally factors shaping the current market conditions and potential trends.
Market Reactions to Economic Signals in Cryptocurrency
Explore how economic signals from the U.S. Treasury and Pakistan's regulations impact cryptocurrency market reactions.