Bitcoin or bust

A handful of struggling London-listed companies are converting cash reserves into bitcoin, a sign that Trump-era crypto fervour is spilling over to the UK View in browser Patricia Clarke • Friday 22 August 2025 Dear friend, Welcome to the Boardroom Sensemaker, The Observer's weekly newsletter for the board chairs, directors and executives in charge of Britain's biggest businesses.         Long stories short Meta put its AI hiring spree on pause after investor concerns. WHSmith shares tumbled 41 per cent after an accounting blunder. Urban Outfitters and Chipotle collaborated on a $99 "burrito blanket".                                           Bitcoin or bust Since May a dozen London-listed companies, including a firm that produces helium and a biotech developing devices for spinal surgery, have begun converting cash reserves into bitcoin. So what? So-called "crypto treasuries" are the latest financial experiment. They're a sign that Trump-era fervour is spilling over to the UK and rewiring struggling businesses. On paper it looks like a clever way for loss-making companies, many of them SMEs, to rally their share prices and attract investor attention. In practice, it's a speculative gamble that creates exit ramps for insiders looking to cash out; echoes past bubbles, from dotcom hype to the memestock mania; and raises systemic risks as more firms move from tangible products to bitcoin. How it works. The first crypto treasury was Strategy (formerly Microstrategy), a data firm that began to invest heavily in bitcoin in 2020. Five years on, Strategy is the world's largest holder of the cryptocurrency, with 629,376 bitcoins worth $71 billion and equivalent to 3 per cent of the total supply. Strategy's current market cap is $96 billion, up from less than $1 billion in 2020. Crypto king. Strategy is now a business intelligence firm in name only. It's a proxy for bitcoin investment, with a share price that often moves in tandem with the price of the cryptocurrency. It works for investors because they gain indirect exposure to bitcoin by buying shares in Strategy, which (unlike bitcoin) trades as a public security. This comes with regulatory protections and easier portfolio integration. "Some institutional investors for instance might not be able to buy bitcoin directly, perhaps because of their own investment mandate or because of restrictions applied by regulators," said Laith Khalaf from AJ Bell. It works for Strategy because its market cap is about 30 per cent greater than the value of the bitcoins it holds. In other words the US public stock market is, for reasons that baffle many analysts, willing to pay a premium for crypto. Strategy takes advantage of the difference. Copycats. The market hack has inspired a number of imitators, mostly based in the US, including GameStop, the electronics retailer that shot to fame in 2021 when it became a memestock after Reddit traders sent its price soaring; Metaplanet, a struggling Japanese investment firm turned hotel operator, which now calls itself "Asia's Microstrategy"; and Trump Media & Technology Group, the company behind the social media site Truth Social and controlled by the US president's family, which said it plans to raise $2.5 billion to buy cryptocurrencies. A total of 169 publicly traded companies hold bitcoin, including about a dozen that are bitcoin miners and exchanges. In the UK, the crypto treasury trend is nascent. The dozen companies embarking on this strategy are mostly lossmakers listed on the Aquis Stock Exchange, which caters to microcaps and high-risk ventures that can't meet the stricter requirements of the London Stock Exchange. The opportunity. Unlike the US, where bitcoin exchange-traded funds now trade on the stock exchange, regulation in the UK makes buying and holding cryptocurrencies difficult. Some see this as an opportunity for crypto treasuries to thrive. The Smarter Web Company, a website design agency founded in Guildford in 2009, became a tech unicorn last month after purchasing $271 million worth of bitcoin and seeing its stock surge sixfold in two weeks. TruSpine, a biotech company developing devices for spinal surgery, is the latest UK business to want in on the craze. In a note to shareholders last June, the company said it would hire an advisory firm to support the implementation of a new bitcoin treasury policy. Dark past. The company, which has never brought a product to market in eleven years, has a history of substantial losses, financial mismanagement and investor mistrust. In 2023, Aquis fined TruSpine £215,000 after it omitted information about its assets and gave the market a distorted view of the company's financial health. The fine was later partly suspended on the condition that TruSpine does not break Aquis rules over the following three years. Turnaround. Geoff Miller, appointed Chairman of TruSpine in 2024, acknowledged the company's "sketchy history" in an interview with The Observer. He thinks the bitcoin treasury strategy represents an opportunity to turn the company around. Unlike Strategy, he hopes to reinvest any money earned from the company's bitcoin holdings in TruSpine's spinal technology. Miller hopes to offer investors a way to stay exposed to bitcoin while holding equity in a business that could generate non-crypto returns. "The dynamics have changed significantly with the Trump administration coming in," he said. "We're now in a position where you can't ignore bitcoin." And yet... "My suspicion is that there will be some people who make a lot of money from this," Khalaf said in reference to the broader trend of crypto treasuries. But he warns that the price of bitcoin is volatile. When companies borrow money to buy crypto, a sudden price drop could force them all to sell at once, creating a chain reaction that destabilises markets. "I suspect the downdraft when it comes could be pretty brutal," he said. The Nibs Capital Economy, business and finance Renovation opportunity A "mansion tax" on luxury property was mooted under the Conservative-Lib Dem coalition in the early 2010s and proposed by Labour in the 2015 general election. Now Treasury officials under Rachel Reeves have been asked to draw up options for property taxes in the autumn budget. A yearly property tax targeted at homes valued at over £500,000 is one reform reportedly under consideration. Another is to remove the capital gains tax exemption on primary residences above £1.5 million. Replacing stamp duty with a national proportional tax or overhauling council tax with a local property tax (suggested by Reeves as a backbencher in 2018) are also on the cards. According to calculations by the Times, a £1.5 million starting point for removing CGT would hand capital gains bills of £199,973 to roughly 120,000 higher-rate taxpayers. The former IFS director Paul Johnson said the policy was a "non-runner" that "would gum up the housing market at the top end hopelessly" and instead called for a major overhaul of housing taxation. Technology AI, science and new things Short on tech Is Palantir too pricey? Renowned short-seller Andrew Left thinks so. A report from his investment firm Citron Research argued that OpenAI's recent $500 billion valuation at $500 provided a true benchmark for frothy interest in Palantir's tech on Wall Street. "If Palantir trades at the same 17x price-to-revenue multiple on $5.6 billion in revenue…" Left said, "the implied stock price would be about $40 per share." That would mark a 77 per cent decline on Palantir's high on Tuesday, which was up more than 145 per cent since the beginning of the year. The stock has now been on a six-day consecutive losing streak, minting billions for struggling short-sellers. Bloomberg reports that short interest in the company has increased by about 10 million shares since the beginning of June. Our planet Climate and geopolitics Fully charged Shares in US-listed Chinese EV start-up Nio have surged in the past week as its battery-swapping technology gains traction. At Nio's 3,000 swap stations in China, robotic arms remove the vehicle's undercarriage and swap out depleted batteries for fully charged ones. CATL, the world's largest battery maker, is building a network of 10,000 stations by 2028 that will serve one million cars each day. The bet, according to the FT, is that the tech is a few minutes faster than charging and a more appropriate fit for China's densely populated cities, where most people live in apartment buildings without their own charge point. But new swap points haven't fared quite so well in Europe. After an initial expansion of swap stations on the continent, mainly in Norway and Germany, Nio's roll-out has slowed. Culture Society, identity and belonging "TV tourists" The head of Channel 4 has accused Netflix of acting like "TV tourists" by reaping the rewards of shows such as Adolescence that relied on talent fostered by public broadcasters. Speaking at the Edinburgh TV festival, Louisa Compton claimed the broadcaster was the "proud parent" of the drama, which focused on a family reeling from the impacts of knife crime fuelled by social media. Adolescence launched on Netflix in March and attracted 140 million viewers in three months. Compton noted that the show's creator Jack Thorne and lead actor Stephen Graham did five dramas on Channel 4 before Adolescence. Ian Katz, Channel 4's chief content officer, said Netflix had reaped the benefits of an "incredibly rich global ecosystem that has been built up through years and years of PSBs investing in talent and small companies." Thanks for reading. Please tell your friends to sign up and tell us what you think. Patricia Clarke patricia.clarke@observer.co.uk Additional reporting by Barney Macintyre. Follow Follow The Observer on social media on your preferred platform:   The Observer     The Observer Food Monthly The Observer Magazine The Observer New Review   Listen Listen for free in the Tortoise app or wherever you get your podcasts: Want to change how you receive these emails? Update email preferences Copyright © 2025 Tortoise Media. All rights reserved. Did this email get caught in your spam filter? 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