Prenetics (PRE), a health sciences company that raised $48 million earlier this year, in part to build a Bitcoin treasury, said it decided to stop buying BTC amid prolonged weakness in the cryptocurrency market.
The company rolled out its bitcoin accumulation strategy in June, following a model championed by Michael Saylor’s Strategy Inc, in which companies raise capital to buy and hold cryptocurrencies on their balance sheets. The business model gained traction earlier this year as cryptocurrency prices rose, but enthusiasm waned after the market’s sharp downturn in October.
On October 27, Prenetics CEO and co-founder Danny Yeung announced the funding round, which included investors including Kraken, Exodus (EXOD), GPTX, and American Ventures. He said the funds would help his “IM8” business expand globally while accumulating 1 BTC per day to reach a goal of $1 billion in revenue and bitcoin within five years.
However, the company said in a statement on Tuesday that it stopped purchasing Bitcoin on December 4 to focus its resources exclusively on IM8, which it said has generated more than $100 million in annualized recurring revenue (ARR) since its launch 11 months ago.
“The phenomenal success of IM8 has exceeded all expectations and grown much faster than initially expected,” said Yeung. “Our board and management team unanimously agreed that the most promising path to creating meaningful and lasting shareholder value is to devote our full attention to this opportunity clearly visible in IM8.”
Prenetics, backed and co-founded by English football icon David Beckham, said it will not allocate any existing or new capital for the purpose of purchasing additional bitcoins. However, he still plans to keep his existing 510 bitcoins as a reserve asset, worth nearly $45 million as of Tuesday afternoon (ET).
Prenetics shares are up 189% this year, while Michael Saylor’s MSTR is down nearly 48% and bitcoin is down about 5.6%.
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