Blockstream CEO Adam Back has led a 21 million Swedish krona ($2.2 million) funding round in H100 Group AB, a Swedish health tech company. This investment will fuel H100’s strategic move to acquire Bitcoin as part of its treasury reserves.
Key Takeaways:
- Funding: Adam Back contributed approximately $1.4 million of the $2.2 million raised.
- Bitcoin Acquisition: H100 plans to use the funds to purchase Bitcoin, adding to their existing holdings.
- Treasury Strategy: This move positions H100 as one of the first public companies in Sweden to adopt a Bitcoin treasury strategy.
H100 announced on May 25 that the raised funds, secured through 0% interest convertible loans, would be allocated to Bitcoin (BTC) purchases, aligning with their announced Bitcoin-buying pivot on May 22. This pivot caused H100 shares to jump 37% following the firm’s initial announcement.
The funding round saw participation from other investment firms, including Morten Klein, Alundo Invest AS, Race Venture Scandinavia AB, and Crafoord Capital Partners.
With this new capital, H100 is poised to acquire approximately 20.18 Bitcoin at current market prices, complementing the 4.39 Bitcoin already purchased on May 22. This will bring their total Bitcoin stash to roughly 24.57 Bitcoin.
The convertible loans, maturing on June 15, 2028, carry no interest. They can be converted into shares at a rate of 1.3 Swedish krona (11 US cents) per share. H100 retains the right to mandate a conversion if its share price remains above 33% of the conversion price for 60 trading days. Full conversion would result in around 16,153,900 new shares, diluting existing shares by about 12%.
H100’s Bitcoin Strategy Explained
The decision to incorporate Bitcoin into its treasury reserves reflects H100’s belief in the cryptocurrency’s long-term value and its potential to align with the company’s customer base.
According to H100 CEO Sander Andersen, the values of individual sovereignty present in the Bitcoin community resonate with the customers and communities the company aims to build on the H100 platform. H100 focuses on providing health tools for individuals seeking alternatives to the traditional reactive health system.
The Rise of Corporate Bitcoin Adoption
H100’s move highlights a growing trend of companies incorporating Bitcoin into their treasury strategies. The number of public firms holding Bitcoin as a treasury asset is on the rise.
According to BitcoinTreasuries.NET data, over 100 public firms now hold the cryptocurrency, including ten based in Europe. H100 is among the first in the region to embrace this evolving financial strategy.
What is H100 Group AB?
H100 Group AB is a Swedish health technology company focusing on providing tools and resources for individuals looking for proactive health solutions. They aim to empower individuals to take control of their health and well-being, moving away from reactive healthcare models.
Why are Companies Adding Bitcoin to their Treasury?
- Diversification: Bitcoin offers diversification benefits, potentially reducing portfolio volatility.
- Inflation Hedge: Some view Bitcoin as a hedge against inflation, preserving capital in the face of currency devaluation.
- Long-Term Investment: Companies may see Bitcoin as a long-term investment with growth potential.
- Technological Innovation: Embracing Bitcoin can signal a company’s commitment to innovation and future-oriented technologies.
Risks Associated with Bitcoin Treasuries
- Volatility: Bitcoin’s price volatility can impact a company’s balance sheet.
- Regulatory Uncertainty: The regulatory landscape surrounding cryptocurrencies is still evolving, creating potential compliance challenges.
- Security Risks: Safeguarding Bitcoin holdings from theft or hacking requires robust security measures.
- Accounting and Tax Implications: Accounting for Bitcoin holdings and navigating tax regulations can be complex.
In conclusion, Adam Back’s investment in H100 Group AB marks a significant step for the company and highlights the growing adoption of Bitcoin as a corporate treasury asset. This move underscores Bitcoin’s increasing acceptance and potential as a valuable component of modern financial strategies.