Prenetics (PRE), a health-sciences company that raised $48 million earlier this year partly to build a Bitcoin treasury, said it has decided to stop buying BTC amid prolonged weakness in the cryptocurrency market.
The company launched its Bitcoin accumulation strategy in June, following the model championed by Michael Saylor’s Strategy Inc., in which companies raise capital to buy and hold the crypto on their balance sheets. The business model gained momentum earlier this year as crypto prices surged, but enthusiasm faded after a massive market decline in October.
On October 27, Prenetics CEO and co/founder Danny Yang announced a funding round, which included investors such as Kraken, Exodus (EXOD), GPTX, and American Ventures. He said the fund will help its “IM8” business scale globally, while accumulating 1 BTC per day toward its goal of $1 billion in revenue and Bitcoin within five years.
However, the company said in a statement on Tuesday that it had stopped buying bitcoin on Dec. 4 to focus its resources exclusively on IM8, which it said had generated more than $100 million in annual recurring revenue (ARR) since its launch 11 months ago.
“The unprecedented success of IM8 has exceeded all expectations and has grown much faster than we expected,” Yeung said. “Our Board and management team unanimously agreed that the most promising path to creating significant, sustainable shareholder value is to focus our full attention on 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 Bitcoin. However, it still plans to keep its existing 510 bitcoins as reserve assets, worth about $45 million as of Tuesday afternoon ET.
Prenetics shares have surged 189% this year, while Michael Saylor’s MSTR has fallen nearly 48% and Bitcoin has fallen about 5.6%.
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