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 launched 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 when cryptocurrency prices rose, but enthusiasm faded after the sharp market crash in October.
On October 27, Prenetics CEO and co-founder Danny Yeung announced the funding round, which included investors such as Kraken, Exodus (EXOD), GPTX, and American Ventures. He said the funds would help his “IM8” business scale globally while accumulating 1 BTC daily toward a goal of $1 billion in revenue and bitcoins within five years.
However, the company said in a statement on Tuesday that it stopped buying 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 has scaled much faster than we originally anticipated,” said Yeung. “Our board and management team unanimously agreed that the most promising path to creating significant and sustainable shareholder value is to devote our full attention to this opportunity clearly visible in IM8.”
Prenetics, backed and co-founded by English soccer icon David Beckham, said it will not allocate any new or existing capital in order to purchase additional bitcoins. However, it still plans to hold its 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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