Year End Report 2025

BTC AB reported a year-to-date operating loss of SEK 40.7m (quarter Oct–Dec operating loss SEK 37.8m) driven largely by an unrealized bitcoin revaluation loss of SEK 36.4m; YTD EPS was SEK -53.64. As of 2026-01-29 NAV per share was SEK 158 versus a market price of SEK 119.80 (NAV discount -22%), with total bitcoin holdings of 166.33 BTC and 0.000213 BTC per B-share (780,313 B-shares). During the quarter the company introduced Class A preference shares paying SEK 1 monthly, completed a directed issue raising ~SEK 7.2m, appointed Pareto Securities as liquidity provider and secured OTC Markets approval (XBTAF) as part of a stated strategy to 'amplify' BTC exposure with a 10–20% leverage target. The operational and strategic moves improve liquidity and capital structure, but near-term financials remain pressured by volatile BTC revaluations.

Analysis

Market structure: BTC AB’s actions (preference-A issuance, 10% dividend target, OTC listing XBTAF) create distinct winners — liquidity providers (Pareto), preference-share buyers seeking yield, and long-biased B-shareholders if amplification executes — and losers: transferee shareholders if leverage/discount widens. The -22% NAV discount (share 119.80 SEK vs NAV 158 SEK) implies a 28 SEK per-share mispricing that can attract arbitrage flows; low operating revenues and concentrated 166.33 BTC reserves limit market-making depth, so price impact per trade will be high in thin Swedish microcap markets.

Risk assessment: Tail risks include EU/Swedish regulatory clampdown on crypto exposures, custodial loss, or a rapid BTC drawdown >30% that magnifies unrealized losses (company already booked MSEK -36.4 unrealized YTD). Time horizons: expect volatile NAV re-rating in days-weeks around BTC moves and liquidity events (preference issuance, OTC volume); over quarters, leverage policy (10–20%) is the key firmware for path dependence of returns. Hidden dependencies include counterparty terms on their announced 5–10x collateralization and whether preference shares are senior/convertible — both materially affect B-share dilution and bankruptcy waterfall.

Trade implications: Direct play is a targeted arbitrage: buy B-shares/XBTAF to capture NAV discount while hedging BTC directional risk; pair trades could short newly issued preference-A vs long B to isolate amplification capture. Use options to manage tail risk: buy 3-month BTC 15% OTM puts or put spreads to cap downside; size trades to 1–3% NAV per position and expect mean-reversion window of 3–6 months. Monitor M&A chatter — a roll-up could rerate small treasuries quickly.

Contrarian angles: Consensus underestimates the compounding power if BTC AB successfully executes repeated preference issuances at favorable prices — a 10% annualized yield on A-shares deployed to buy BTC could boost BTC per B-share materially over 12–24 months. Conversely, market may be underpricing governance/leverage risk: if preference terms are senior and non-dilutive to dividends, B-share upside is limited. Historical parallels: small listed BTC treasuries (2019–2021) rerated >40% on liquidity/OTC access; liquidity is the decisive variable here.

Key Decisions for Investors

• Establish a 2–3% portfolio long position in XBTAF (or the listed B-shares) within 2 weeks to capture the ~22% NAV discount; target exit when discount compresses to ≤5% or within 3–6 months, whichever comes first; hard stop-loss at -12% from entry.
• Implement a hedged pair: long B-shares (1–2% portfolio) and short Preference A (or short-equivalent) at 0.8–1.2x notional to isolate BTC per B-share exposure; unwind if company issues additional preference shares increasing outstanding A by >10% (monitor weekly filings).
• Buy protection: purchase 3-month BTC 15% OTM puts (or structured put-spread: buy 15% OTM, sell 30% OTM) sized to cover 50–75% of implied BTC exposure from the B-shares; adjust if BTC volatility (30d) rises above 80%.
• Reallocate 1–2% from non-crypto Swedish small-caps into liquid crypto infrastructure names (COIN, CME) as tactical rotation for 3–9 months, reducing concentration risk if BTC AB’s leverage policy exceeds 20% or an EU regulatory advisory is announced within 30–90 days.