Mode, a London Stock Exchange-listed company that touts itself as a “bitcoin banking app,” revealed it now holds around £ 750,000 ($ 980,000) of bitcoin after announcing its intention this week to put 10% of its liquidity reserves in cryptocurrency.
Mode became the first publicly traded UK company to put bitcoin on its books, making the announcement on the heels of Square, the payments company run by Jack Dorsey.
“We made the decision to start buying bitcoin about ten days ago,” Mode founder and executive chairman Jonathan Rowland said over the phone. “We wanted to put our money where our mouth is.”
Custody of Mode’s nearly $ 1 million worth of Bitcoin is shared between US cryptocurrency firms BitGo and Coinbase.
Mode, which now has 25,000 users of its iPhone-only bitcoin buying app, according to Rowland, announced this week that it plans to buy bitcoin as part of a long-term strategy to “protect investor assets from currency degradation ”and said it would convert“ up to 10% of its cash reserves into bitcoin ”.
Mode’s share rose about 10% on the news, rising alongside the price of bitcoin which skyrocketed after payments giant PayPal
Earlier this month, Mode raised £ 7.5million when it debuted in the London market and aims to use the funds to reach 1million users within three years.
Rowland said he expects Mode’s stock to move with the price of bitcoin in the future.
“There is an element of fashion trading in the price of bitcoin,” he said. “Fashion shares can give people a proxy for owning bitcoin. It gives people the ability to gain exposure without buying bitcoin.”
After a few difficult years, bitcoin has found new support in 2020 due to a return to ultra-low interest rates around the world and as a potential hedge against inflation that some see on the horizon – catching the attention of some reputable investors.
Bitcoin was put in the spotlight earlier this month when Square, led by Twitter
“We met Jack Dorsey and talked to him about adding bitcoin to treasury assets last year,” said Rowland, who added that he believed bitcoin would eventually become “the only real world currency” .