Key Points
- Critical Metals Corp announces a $500M Bitcoin treasury strategy, becoming the first Nasdaq-listed mining company to do so.
- The strategy echoes MicroStrategy’s Bitcoin playbook, with Critical Metals planning to use Bitcoin as a primary asset in its treasury.
Critical Metals Corp, a Nasdaq-listed mining firm, recently disclosed its decision to adopt a Bitcoin treasury strategy.
The company’s Board of Directors has approved the plan to hold Bitcoin as a primary asset in its treasury, marking it as a crucial element in its treasury management strategy.
Financing the Bitcoin Treasury Strategy
Critical Metals Corp’s strategy is backed by a financing agreement with JBA Asset Management.
The agreement enables the mining company to access up to $500 million for the acquisition of Bitcoin.
The first tranche of $100 million is available for Bitcoin purchases, subject to certain undisclosed conditions.
This initial amount is accompanied by 100% warrant coverage, meaning investors have the right to buy additional company shares in the future at a fixed price, equivalent to their investment.
The remaining $400 million, which is optional and can be accessed later, offers 50% coverage.
Thus, for every dollar invested, the investor can buy extra shares equivalent to half their investment value, again at a fixed price.
Bitcoin Treasury Strategy and Government Policy
Critical Metals’ Bitcoin treasury strategy aligns well with the pro-crypto government policy under Donald Trump’s renewed presidency.
The company’s Executive Chairman and CEO, Tony Sage, has also expressed interest in purchasing Bitcoin through the company.
He believes this strategy will strengthen the company’s balance sheet and use Bitcoin as a hedge against potential inflation.
Furthermore, Sage noted that the strategy aligns with initiatives in Western governments, including proposals for many countries to establish a National Bitcoin Reserve.
Critical Metals now stands alongside prominent companies like MicroStrategy, the world’s largest publicly traded Bitcoin holder.
On the same day, MicroStrategy revealed that it had added another 11,000 Bitcoin to its holdings, purchased for $1.1 billion.
This addition brings the company’s total Bitcoin holdings to 461,000, acquired over time for approximately $29.3 billion.