Zak Mir talks to Malcolm Palle, Executive Chairman of Coinsilium Group Limited

Coinsilium's Strategic Approach to Bitcoin Treasury Management
Zak Mir talks to Malcolm Palle, Executive Chairman of Coinsilium, as the Aquis-quoted digital asset investor and venture builder provides an update on its Bitcoin treasury activity and that of its wholly owned Gibraltar subsidiary, Forza Gibraltar Limited, established to implement the company’s dedicated Bitcoin-focused treasury operations. 
Palle describes the progress of Coinsilium over the recent Bitcoin Treasury Strategy boom and how the company's experience in the digital space is a key differentiator.

Raising Capital and Deploying Bitcoin Treasury Strategy

Malcolm highlights that Coinsilium’s Bitcoin treasury strategy is built on three essential pillars: raising capital, purchasing Bitcoin, and communicating these developments to shareholders and the market. The company’s ability to acquire Bitcoin is directly tied to the funds raised, and despite the challenges presented by the UK market—particularly compared to the more mature US ecosystem—Coinsilium remains optimistic about its growth trajectory.

Recently, Coinsilium completed a £5 million placing alongside a £510,000 wrap with Winterflood, which was significantly oversubscribed. This marks the company’s largest fundraising effort to date, underscoring strong investor confidence. Importantly, all new funds raised are dedicated almost exclusively to Bitcoin purchases, with only minimal allocation for working capital and no other investments outside the core focus.

In addition to the fresh capital raise, Coinsilium acquired approximately 12 more Bitcoin from its existing resources, bringing the total to 124 Bitcoin as of mid-2024. Malcolm anticipates that following the deployment of the new funds, the company’s Bitcoin holdings could increase by nearly 50%, a substantial boost that will further cement Coinsilium’s position as a leverage play on Bitcoin.

Navigating Market Volatility and Funding Dynamics

Malcolm candidly acknowledges the turbulent market conditions, likening the current environment to flying a plane through heavy turbulence. Despite this, he advises investors to maintain a long-term perspective, focusing on the broader horizon rather than short-term market noise. The dynamic nature of funding availability and market capitalization impacts Coinsilium’s ability to raise capital, but recent developments such as Oak Securities’ launch of a dedicated digital asset fund provide encouraging signs of growing institutional support.

Coinsilium’s lean operational structure—without large teams or costly offices—means that a smaller proportion of funds raised must be allocated to overheads. This efficiency allows more capital to be directed toward Bitcoin acquisition, further reinforcing the company’s core treasury strategy.

What Differentiates Coinsilium in a Crowded Market

With an increasing number of companies adopting Bitcoin treasury strategies, Malcolm stresses the importance of experience and a well-defined approach. Coinsilium’s long-standing presence in the digital asset space provides a strong foundation, contrasting with many newer entrants who may lack a robust strategy or the ability to sustain funding over multiple raises.

He urges investors and companies alike to conduct thorough research before entering this space. Holding some Bitcoin on a balance sheet is not sufficient; a company’s roadmap, treasury policy, and strategic vision must be carefully examined. Coinsilium’s publicly available Bitcoin treasury policy outlines its objectives and methodology, serving as a valuable resource for understanding the company’s commitment to this space.

Malcolm also highlights the importance of understanding the concept of a leverage play on Bitcoin. Investors often evaluate companies based on the "MNAV" (multiple of net asset value), which functions similarly to a price-to-earnings ratio in traditional equity markets. This metric helps determine whether a company’s valuation is justified by its Bitcoin holdings and growth prospects.

Regulatory and Structural Considerations in the UK

Unlike some US counterparts, UK companies face additional regulatory complexities when structuring Bitcoin treasury operations. Companies cannot simply exist as entities that hold Bitcoin; they must have underlying business activities that differentiate them from passive holders or trackers of cryptocurrency value. Coinsilium meets these requirements through its diversified investments and operational ventures, including its wholly owned Gibraltar subsidiary, Forza Gibraltar Limited, which focuses on Bitcoin treasury operations.

These regulatory nuances add a layer of complexity but also contribute to the credibility and sustainability of companies like Coinsilium in the UK m