The Smarter Web Company has officially launched the UK’s first Bitcoin‑linked convertible bond, a move that promises to redefine how businesses raise capital. This digital bond innovation marks a fusion of traditional finance and digital assets, issuing £21 million worth of zero‑coupon bonds fully subscribed by French asset manager TOBAM.
From the outset, the digital bond innovation enabled investors to convert their holdings into equity at a 5% premium to the reference share price of £1.95—or accept 98% principal repayment if not converted within 12 months. If shares trade 50% above the conversion price for 10 consecutive days, the company can force conversion after six months, adding structure to this new financial tool.
A Fresh Path in Capital Markets
The Smarter Web Company has embraced Bitcoin not just as a treasury asset but as a core part of its fundraising strategy. With this bond denominated in Bitcoin, both repayment value and investor returns will fluctuate along with BTC price movements. Still, the structure includes a cap limiting new Bitcoin purchases to 30% of its unencumbered treasury—demonstrating prudence amid innovation.
Notably, TOBAM’s full subscription highlights growing institutional trust in digital bond innovation. TOBAM endorsed this structure, citing its appeal of premium equity participation, careful downside protection, and alignment with the company’s long-term growth strategy.
Risk and Reward Balanced
This bond brings upside if Bitcoin and the company’s share price rise—but also features safeguards. If unconverted, the bond returns 98% of principal, protecting investors from total loss. The structure makes for a nuanced digital bond innovation that blends the volatility of crypto with traditional downside limits.
If all bonds convert to equity, the company would issue roughly 7.7 million new shares—representing lower dilution compared to a conventional equity raise. Conversion is set at a fixed price in GBP, while repayment varies in Bitcoin, giving both investor flexibility and downside control.
Strategic Relevance in a Mature Market
This capital instrument complements Smarter Web’s broader strategy to integrate Bitcoin into its corporate infrastructure. Since adopting a Bitcoin treasury policy in 2023, the company has also accepted Bitcoin as a form of payment. Their aim: to become a publicly listed leader in digital finance while maintaining compliance with UK securities rules.
By launching this bond, the firm offers a blueprint for digital bond innovation that other UK-listed companies may now emulate. It sends a clear signal: Bitcoin can serve broader financial goals—not merely speculation.
Looking Ahead
If regulators continue to foster favorable conditions, similar instruments may gain traction in the UK and beyond. For now, this first-of-its-kind issuance marks a bold step toward mainstream adoption of crypto-linked capital tools.