K33 Raises $6.2 Million to Build Bitcoin Treasury Strategy

Norwegian crypto brokerage K33 has raised $6.2 million to purchase Bitcoin as part of its new strategy to establish a Bitcoin treasury. The funding comes from convertible loans and share issues. K33 aims to use its Bitcoin reserves for future revenue streams, while its stock price dipped slightly after the announcement. The company’s CEO expects significant performance from Bitcoin in the coming years.

European crypto firm K33, based in Norway, has successfully raised 60 million Swedish krona, which is about $6.2 million, to kick-start its Bitcoin accumulation efforts. This initiative is part of a trend among public companies aiming to secure assets in Bitcoin. The announcement came on May 28, detailing that these funds derived from convertible loans and new shares and warrants will be entirely dedicated to acquiring Bitcoin, underpinning their “Bitcoin Treasury Strategy.”

The arrangement involves zero-interest securities known as warrants, which investors can later exchange for equity at a fixed price. At current Bitcoin prices, K33 could potentially purchase up to 57 Bitcoin. K33’s CEO, Bull Jenssen, expressed confidence on social media about Bitcoin’s future, stating it might become the “best-performing asset in the coming decade.” He emphasised the intention to build a substantial treasury while capitalising on operational synergies with their brokerage services.

In another post, Jenssen highlighted the proactive approach K33 is taking: “Why wait for the government to build a Bitcoin reserve when you can build your own? Initial financing is secured, and we are ready to accelerate from here!” The arrangement includes convertible loans amounting to 45 million Swedish krona and a further 15 million Swedish krona from new shares and warrants. These convertible loans are interest-free, maturing in June 2028, and if investors act to convert their warrants before March 2026, they are eligible for extra free warrants at the same rate.

A fully realised exercise of these warrants could see K33 fetching up to 75 million Swedish krona (around $7.7 million) for its Bitcoin purchases. In their interim report issued the same day, Jenssen noted collaborations with other Bitcoin treasury entities in the Nordics. He remarked that leveraging a BTC reserve could aid in launching more services, including Bitcoin-backed lending.

For K33, Bitcoin serves not only as a moneymaking asset but also as a strategic tool. Jenssen believes it will reinforce their financial standing and help unlock new opportunities, products, and partnerships. In reaction to the treasury news, K33’s share price remained relatively stable, dipping by 1.96% on May 28.

Historically, the market reaction to Bitcoin purchases varies; for instance, GameStop’s shares soared nearly 12% after unveiling its Bitcoin buying plan in March but soon fell after making its first Bitcoin acquisition. Contrastingly, shares of Paris-based Blockchain Group rocketed by 225% when it reported its Bitcoin-buying intentions last November.

The fluctuations in these companies’ stock prices following such announcements highlight the unpredictable nature of the cryptocurrency market.