BTC Wealth Report – Issue 11

👋 Welcome to BTC Wealth — Issue 11

Traditionally, alt season meant rotating out of BTC into smaller-cap coins for a high-beta play.

But that’s not where the capital is going this cycle.

This time, it’s flooding into Leveraged Bitcoin Equities (LBEs) — aka Bitcoin Treasury Companies.

And the returns are explosive:

• Metaplanet is up 411% YTD

• Blockchain Group is up 1,700%

• Smarter Web Company is up 2,000% this month

These are public companies running advanced financial engineering to accumulate more BTC per share.

And the market loves it.

In this issue we’ll unpack how they’re doing it — and why it matters.

🧮 What Is an LBE?

In some ways LBEs are turbocharged Bitcoin exposure.

But this is isn’t just a leverage play on the bitcoin price. These vehicles are using equity structures, convertible bonds, and creative financing to build treasuries that are building value even as bitcoin price chops sideways.

And because they’re public equities, they can trade at wild premiums to NAV — giving them even more ammo to spin the flywheel.

🔧 In This Issue:

Here’s what we’re breaking down:

• 🔄 The Warrant + Short Strategy — How Metaplanet replicates the Saylor playbook without an ATM

• 💸 Bitcoin-Denominated Bonds — How The Blockchain Group raised BTC with debt based innovation.

This is a new frontier in how Bitcoin gets financialized.

But it’s complicated. So let’s understand how it works.

🔄 The Warrant + Short Strategy: Metaplanet’s Synthetic ATM

MicroStrategy pioneered the original Bitcoin treasury flywheel:

1️⃣ Sell equity at a premium
2️⃣ Buy Bitcoin
3️⃣ Boost BTC per share — even while diluting

It’s nice and simple. But this kind of “at-the-market” (ATM) equity issuance is only legal in the U.S.

In Japan, you can’t just mint new shares and dump them on the market.
No ATM programs. No free-flowing dilution.

So what did Metaplanet do?

They engineered their own workaround.
And it’s one of the smartest financial innovations of this cycle.

Through a partnership with Evolution Financial Group (EVOFund), they’ve built a synthetic ATM — using warrants, borrowed shares, and a positive feedback loop.

🏗️ How It Works — Step by Step

1️⃣ Metaplanet issues warrants
EVOFund is granted the right to buy new shares at yesterday’s closing price.

2️⃣ EVO borrows shares
They source shares from a large holder.
(Yes, even more partnerships are needed to pull this off.)

3️⃣ EVO sells into the market
They sell those borrowed shares at today’s price.

4️⃣ They exercise the warrant
The warrants are “moving strike,” meaning EVO can buy brand-new shares from Metaplanet at yesterday’s price.

5️⃣ They close the short
EVO returns the borrowed shares and pockets the spread.

🎯 Meanwhile: Metaplanet receives all the yen raised from the new issuance.
Just like an ATM raise — without needing one.

🧠 Why This Is Brilliant

There’s one key constraint baked into this system:
It only works when the stock is going up.

Why?

Because EVO only profits when today’s price is higher than yesterday’s.
If the price is flat or falling, the incentive to exercise the warrant disappears.

This creates a natural throttle:

✅ When Metaplanet’s stock is rising — they issue new shares
⛔ When it’s falling — the system turns off

Which means Metaplanet is only ever selling into strength.
Clever financial engineering — and it’s producing real BTC per share growth.

🏦 The Debt Play: Blockchain Group’s Convertible Bonds (Paid in BTC)

A different Bitcoin Treasury Company — The Blockchain Group (TBG), listed in Paris — has pioneered another powerful tool: Bitcoin-denominated debt.

The lead investor also happens to be OG Bitcoin Legend and Blockstream CEO, Adam Back

⚙️ How It Works

1️⃣ Adam lends BTC to TBG
He subscribed to a €12.1M convertible bond — paid in Bitcoin, not cash.

2️⃣ TBG adds BTC to its balance sheet
BTC / Share starts climbing

3️⃣ Bond can convert to equity
If TBG’s stock price trades above a defined threshold, the bondholder can convert debt into discounted shares.

Adam Back already did this once.
He converted his Tranche 1 bond into 14.88M shares — becoming one of TBG’s largest shareholders without ever touching fiat.

❗ But What If the Stock Doesn’t Rise?

Here’s where it gets really interesting.

If the stock doesn’t hit the trigger price — or if Bitcoin moons but the stock lags behind — Back doesn’t have to convert.

Instead, he can just reclaim his Bitcoin when the bond matures.

It’s a clean asymmetric bet:

• If the equity performs → convert and ride the upside

• If it lags → take the BTC back

It’s an elegant structure for OG Bitcoiners who want to leverage their BTC without selling — and maybe pick up equity exposure on favorable terms.

🟠 Why This Works for TBG

This strategy allows TBG to aggressively grow its BTC holdings without needing to sell equity or raise fiat.

💥 If BTC price drops?
The liability — denominated in BTC — actually shrinks in euro terms.

💥 If BTC rips?
TBG’s balance sheet explodes higher — and bondholders may convert into equity, further aligning incentives.

This is a new financing strategy that could be a game-changer for accelerating treasury adoption — It’s worked well for both parties so far.

🧮 Why All of This Matters

Leveraged Bitcoin Equities are ripping.

But behind the performance is a layer of complex financial engineering — warrants, convertible bonds, BTC-denominated debt.

Hundreds of these companies are coming, so if you want to understand the market you need to know what game they’re playing.

So far… It’s working. BTC per share is rising. Market caps are ballooning. Investors are winning.

That could change quickly. These are risk-on, high-volatility vehicles — and things can unravel fast.

But truthfully, I don’t think it will. I think we’re still early in this trend.

This is the Bitcoin Treasury Cycle.

📊 Flows Update: Inflows continue

This week’s ETF flows were strong in spite of Bitcoin’s choppy price action. Once again the story is Blackrock inflows and small outflows from the rest.

• BlackRock (IBIT): +11677 BTC

• ARK (ARKB): -1790 BTC

• Fidelity (FBTC): -611 BTC

🟢 Total Net Flows: +9626

The structural bid is still there.

🧠 Final Thoughts

We’re entering a new phase of the cycle.

It’s like an Alt season — but this isn’t dog-coin roulette.
LBEs are attracting the capital.

The new meta is financial engineering listed equities that act like BTC compounding machines.

This is the moment Bitcoin’s financialization begins in earnest.

Altcoins are out. The new leverage is equity.

And if this experiment holds — BTC Treasuries could become the dominant high-beta bet in every cycle to come.

That’s your BTC Wealth Report this week.

Found this valuable? Share it with your friends.

It helps more than you think.

Thanks for reading,
— Thomas Fahrer