Key Takeaways:
The Smarter Web Company sold 177.89 Bitcoin at $65,762 each to repay an $11.7 million convertible note early, a transaction that reduced Bitcoin per share by 6.18% despite eliminating 7.7 million potential shares.
"The conversion price had not been met, and management chose to simplify the capital structure," CEO Andrew Webley said on X, describing the instrument as more akin to debt than equity in the company's treasury analytics.
The UK-listed firm held 2,878 BTC before the July 23 repayment and now holds 2,700.11 BTC, a 6.18% decline. The Smarter Convert instrument, launched in August 2025 with a $21 million subscription, gave TOBAM Group the option to convert at £2.0475 per share — about seven times the current 29.20p market price — or take settlement in Bitcoin or fiat. SWC chose to repay in cash, extinguishing the claim two weeks before its Aug. 5 maturity.
The repayment removed a Bitcoin-linked obligation but left the company with a tougher capital-allocation test. SWC's existing $30 million Coinbase facility carries no fixed maturity but is secured against Bitcoin, meaning a material price decline could require additional collateral. The company's mNAV of roughly 1.06 times leaves a narrow cushion for any equity raise before dilution enters the BTC-per-share calculation.
On a per-share basis, the math was negative under both relevant denominators. Gross Bitcoin exposure fell 6.18% per legally issued share to 725.90 sats, and 4.17% per management-defined fully diluted share to 750.41 sats, according to CryptoSlate calculations. The company's own Quarterly Gross BTC Yield for the third quarter came in at negative 4.35%, which Webley attributed primarily to the convert repayment.
The original structure required at least 98% of the subscription proceeds to be deployed into Bitcoin, and SWC deployed 100%. The repayment therefore corresponded to the full 177.89 BTC acquired with the instrument. SWC sold those coins and paid $11,698,540 in cash rather than transferring Bitcoin in kind.
The next challenge for SWC is replacing the capital. Equity works best for a Bitcoin treasury company when shares can be sold at a sufficient premium to the Bitcoin value per share. Near or below net asset value, issuance can increase nominal Bitcoin while reducing exposure per share. Recent examples in the sector — including a B Treasury Capital preferred-share offering that left 47.7% of its shares unfilled and Satsuma's proposed Bitcoin sale and delisting — illustrate the pressure on treasury wrappers to find efficient financing.
This article is for informational purposes only and does not constitute investment advice.
