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On November 19, 2025, Paris-based Sequans became the first large Bitcoin treasury firm to liquidate a portion of its holdings, selling 970 BTC for $93 million. This move underscores a significant challenge facing Bitcoin Treasury Companies (BTCTCs): the financing methods they use to amass Bitcoin often carry hidden risks. Brian Brookshire, Bitcoin lead at H100 Group, has raised concerns about the reliance on convertible bonds, highlighting them as a perilous yet underrated threat to corporate Bitcoin strategies.
Convertible bonds enable companies to secure funding at a premium to spot share prices. This method can seem advantageous, as demonstrated by The Smarter Web Company’s $21 million “Smarter Convert” instrument, structured as a Bitcoin-denominated convertible. However, Brookshire warns that these financial instruments come with refinancing risks, are frequently accompanied by substantial upfront short-selling, and may take up to five years to settle. This can leave companies vulnerable when market conditions shift unfavorably.
The issue with convertible bonds is not new in corporate finance, but their use has grown more complex with the inclusion of volatile assets like Bitcoin in corporate treasuries. Historically, convertible bonds have been a favored tool for companies to raise capital without immediately diluting equity. However, the addition of Bitcoin’s unpredictable price dynamics adds another layer of risk. Companies must be cautious; if a firm’s equity falls below the bond’s conversion level, it faces the potential necessity of selling off Bitcoin or enduring unfavorable refinancing, which can negatively affect both the stock and Bitcoin markets.
A report from Keyrock earlier this year projected a looming $12.8 billion debt maturity wall for BTC-focused companies, primarily consisting of convertible notes maturing in 2027-2028. This concentration of debt maturity could spell trouble if market conditions sour, forcing companies into difficult financial decisions that could have broader implications for the Bitcoin market.
The strategy of leveraging convertible bonds can be tempting for those aiming to emulate high-profile companies like MicroStrategy, which has become a poster child for corporate Bitcoin accumulation. Despite a decline in its mNAV multiple from 1.52x to approximately 1.11x, Executive Chairman Michael Saylor maintains confidence in the company’s ability to endure a significant Bitcoin price downturn. However, this confidence is not universally held, as market analysts remain vigilant about the potential for negative feedback loops that could drag down both corporate equity values and Bitcoin prices.
The experiences of companies like Sequans illustrate the importance of strategic foresight for BTCTC management. Brookshire emphasizes the necessity for these leaders to understand the trade-offs involved with each financial instrument, advocating for decisions that prioritize long-term shareholder interests over short-term gains. As companies continue to navigate the complexities of integrating Bitcoin into their financial structures, the risks associated with convertible bonds demand careful consideration.
Despite these challenges, some companies continue to expand their Bitcoin holdings aggressively. Tokyo-listed Metaplanet has increased its Bitcoin reserves to 30,823 BTC as of November 19, 2025, following a series of strategic acquisitions. In contrast, WiseLink, another player in the market, executed a three-year convertible note to Nasdaq-listed Top Win International, marking Taiwan’s first foray into Bitcoin treasury strategies via convertible bonds.
The underlying issue remains the unpredictable nature of both financial markets and Bitcoin prices. While some companies like MicroStrategy and Metaplanet seem well-positioned to ride out potential storms, others may find themselves in precarious positions if they lack the financial robustness or strategic foresight to handle significant market fluctuations.
In this environment, one key risk is the potential for regulatory changes that could affect both the cryptocurrency and corporate finance landscapes. Governments worldwide are increasingly focused on regulating cryptocurrencies, which could impact their value and, consequently, the strategies of companies holding significant Bitcoin investments. Additionally, changes in interest rates or broader economic conditions could alter the attractiveness of convertible bonds as a financing tool.
The situation presents a complex picture for corporate leaders and investors alike. While the allure of significant gains from Bitcoin investments remains strong, the path forward is fraught with uncertainty. Companies must balance the potential benefits of Bitcoin exposure with the inherent risks of the instruments they use to finance these holdings. Failure to do so could lead to financial distress, not only for individual firms but potentially for the broader market. As the market evolves, continuous vigilance and strategic adaptation will be essential for companies navigating the intricate landscape of Bitcoin treasury management.
