Smarter Web Secures $21M from TOBAM via Bitcoin Convertible Bond Launch
Smarter Web has launched Smarter Convert, a bitcoin denominated convertible bond fully subscribed by TOBAM for $21m.
Quick overview
- Smarter Web has launched Smarter Convert, a $21 million bitcoin denominated convertible bond fully subscribed by TOBAM, marking a first in capital markets.
- The bond allows conversion into equity at a 5% premium and includes a forced conversion option after 6 months if the stock price rises significantly.
- If not converted within 12 months, Smarter Web will repay 98% of the bond's value adjusted for bitcoin's price at maturity, linking repayment to BTC performance.
- The company plans to use the proceeds to increase bitcoin reserves while capping holdings at 30% of its treasury to manage volatility risks.
Smarter Web has launched Smarter Convert, a bitcoin denominated convertible bond fully subscribed by TOBAM for $21m. This is a first in the capital markets, combining digital asset performance with traditional financing instruments.
TOBAM, a French asset manager that has been active in bitcoin since 2016, backed the whole issue through three of its funds. The bond allows holders to convert into equity at a 5% premium to Smarter Web’s £1.95 reference share price. The company also has the right to force conversion after 6 months if the stock trades 50% above the conversion price for 10 days.
If conversion doesn’t happen within 12 months, Smarter Web will repay 98% of the bond’s value, adjusted for bitcoin’s price at maturity, so the repayment is tied to BTC’s performance.
Hybrid Model Combines BTC and Equity
Smarter Convert introduces a hybrid financing model that aligns equity upside with bitcoin’s price action while providing downside protection for investors. According to CEO Andrew Webley, the aim is to open up new funding channels while strengthening the company’s bitcoin backed balance sheet.
“This is another first for the UK capital markets,” Webley said. “We’ve been focused on building a BTC tied treasury. This structure supports our funding strategy and taps into a new capital pool.”
Key features of the bond:
- Conversion Premium: 5% over £1.95 share price
- Forced Conversion: After 6 months with 50% share price gain
- Repayment: 98% of bond value in BTC if not converted in 12 months
- BTC Allocation Cap: 30% of unencumbered treasury
The company sees this as a bridge between traditional fixed income investment and bitcoin exposure, for institutional investors looking for structured crypto linked opportunities.
Future Tranches to Follow
With the successful take up of this first tranche, Smarter Web is considering further bitcoin denominated fundraising. The company believes this capital raising framework can be repeated to attract premium investors while deepening corporate exposure to BTC in a controlled and risk aware way.
The proceeds will be used in part to increase bitcoin reserves, but holdings will remain capped at 30% of the company’s available treasury to mitigate volatility related risks. This conservative approach means the company will grow its BTC base without compromising financial stability.
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