Coinshares International Limited - Annual report 31 December 2024

2024 ANNUAL REPORT

BOARD OF DIRECTORS AND EXECUTIVE MANAGEMENT

AS AT 31 DECEMBER 2024

Board of Directors

Daniel Masters

Chairman

Jean-Marie Mognetti

CEO / Board Member

Johan Lundberg

Independent

Non-Executive Director

Carsten Køppen

Independent

Non-Executive Director

Christine Rankin

Independent

Non-Executive Director

Viktor Fritzén

Independent

Non-Executive Director

Management Team

Jean-Marie Mognetti

CEO

Richard Nash

Chief Financial Officer

Benoît Pellevoizin Head of Marketing & Communications

Pierre Porthaux

Head of Quantitative R&D

Frank Spiteri

Head of Asset Management

Lewis Fellas

Head of Hedge Fund Solutions

‌TABLE OF C ONTENT S

- Message from the CEO 4
- Summary of Financial Performance 7
- CoinShares Asset Management 11
- CoinShares Capital Markets 16
- Industry & Market 19
- Corporate Governance Report 28
- Sustainability Report 47
- Audited Financial Statements 58

‌MESSAGE FROM THE CEO

Dear shareholders,

In 2024, we achieved unparalleled success—one of our best ever quarters (Q4) and most successful year in asset management—coinciding with Bitcoin’s record-breaking highs. Topline performance surged 59% year-on-year to £126.5 million, up from £79.5 million in 2023, with an EBITDA of £109.5 million. This equates to an 87% EBITDA margin, showcasing our business model’s efficiency and scalability.

2024 proved pivotal for us and the industry. Our initial thesis—digital assets’ financialisation— materialised with the SEC’s approval of Bitcoin ETFs and institutional adoption. Sovereign states are actively debating adding Bitcoin to their balance sheets.

CoinShares’ trajectory mirrored the industry’s evolution remarkably. We became a global player through our strategic Valkyrie acquisition, a US digital asset manager and ETF platform. This expansion anticipated the digital asset industry’s globalisation as the US Securities and Exchange Commission (SEC) approved Bitcoin and Ethereum ETFs in the US market. Within a year, we have transformed the platform, demonstrating our value extraction capabilities.

The Valkyrie acquisition marked our entry into the crucial US market without compromising our European growth strategy. CoinShares Physical Bitcoin established leadership despite a late 2021 launch. While industry conditions influence our performance, we maintain our European dominance and relevance amidst increasing competition.

Envisioning CoinShares without US market presence revealed a stark reality—we would have forfeited significant industry relevance and competitive edge. This insight underscores our organisation’s strength: despite our modest size compared to industry giants or privately-held competitors, we consistently identify and swiftly capitalise on strategic opportunities.

Our Business Model and Strategic Direction

CoinShares operates a diversified business model, across three complementary and mainly predictable recurring revenue and income streams:

Asset Management: Generating predictable management fees accruing daily.
Lending and Staking: Generating predictable lending and staking yield accruing daily.
Capital Markets: Statistical arbitrage, delta-neutral trading, and liquidity provision generating spread- based gains as a function of the market term structure and observed market volatility.

This diversification provides resilience across market cycles and allows CoinShares to be profitable in all phases of the cycle.

Moreover, we continued to diversify our revenue base beyond CoinShares XBT Provider, by growing and investing in new asset management platforms in Europe and the US, including CoinShares Physical and Valkyrie. These platforms now serve as foundations for growth through new product launches and further strategic initiatives.

The digital asset landscape remains nascent. A lot of well-funded projects are still searching for problems to solve. Among this crowd, Bitcoin emerges as the most established use case. Besides, it is noteworthy that the number of Bitcoin maximalists is increasing year on year. This environment isn’t merely similar to venture capital—it is fundamentally powered by venture capital dynamics, but with a crucial distinction: blockchain projects offer unprecedented liquidity and accessibility through tokenisation, democratising investment opportunities previously reserved for institutional players.

My analysis of past product strategies suggests we’ve been guarded, particularly regarding ETP launches. In a market that functions like venture capital, offering optionality becomes essential. The success of our Solana ETP—now our third most profitable physical product—while other crypto ETPs underperformed illustrates this perfectly. Such outcomes defy conventional forecasting and traditional asset management mindset.

To borrow from venture capital philosophy: “Home Runs Matter, Strikeouts Don’t.” This represents calculated strategy rather than recklessness—a mathematical approach to transformative success. Looking forward, we must accelerate the launch of additional single-coin products across Europe. These initiatives require a lot of crypto market expertise but modest capital deployment.

Competitive positioning

We spent 10 years building an incredible company in Europe. Some of our earliest employees are still with us, advocating for growth and innovation. However, to remain relevant and competitive, we are not going to use the exact same playbook for the next 10 years.

Indeed, building a presence in the US market demands a different approach. While major traditional asset management franchises have largely avoided launching crypto ETPs in Europe since their inception in 2014—creating a market dominated by digital asset specialist firms like ours—these same institutions were positioned at the starting line when the SEC approved Bitcoin and Ethereum ETFs in 2024.

This has created a stark contrast: in Europe, pure-play digital asset managers maintain a significant lead, while in the US, we face immediate competition from established financial giants. Our competitive advantage lies in providing complementary offerings—specialised, distinctive products with strong added value.

We leverage our extensive expertise in alternative investment combined with over a decade of digital asset management experience. Our product team is actively developing innovative vehicles similar to our $WGMI ETF—an actively managed Bitcoin Miners ETF that maintains its distinctive position despite emerging competitive interest.

To summarize, we have methodically constructed a robust foundation across two continents. The infrastructure is established. The time has arrived to leverage those platforms through calculated initiatives that align perfectly with our strategic growth ambition.

Lack of Equity Value Recognition

Despite strong financial performance in 2024—delivering a share price return of 115%, closely tracking Bitcoin’s performance—our valuation remains well below industry comparables. Our EV/EBITDA ratio stands at 2.62 compared to an industry average of 7-10x for alternative asset managers, and our P/E ratio of 3.4x contrasts with 22-26x for the same peers. This substantial valuation gap, despite our significantly above-average return on equity of 38%, highlights the disconnect between our financial performance and market recognition.

This undervaluation is partly attributable to our listing in Sweden, which limits global investor access and price discovery due to local market dynamics and a complete absence of institutional capital investing in the digital asset space. To address this, we have adopted a dividend policy and issued dividends, as well as an exceptional dividend payment. Additionally, we have launched a dedicated Investor Relations website, initiated analyst coverage with Red Eye and ABG Sundal Collier, participated in Swedish investor events, and amplified quarterly earnings coverage in Swedish media. However, these measures have yet to resolve the structural challenges associated with this listing venue.

When we listed in 2021, we were clear with the market that listing in Sweden was a step toward seeking a US listing. We reaffirmed this message when we were accepted onto the Nasdaq Stockholm main market in December 2022. With the most recent policy shift in the US, these plans are finally becoming actionable.

As we work to improve recognition for our financial performance and address the current valuation disconnect, we will keep the market updated on our progress.

Looking Forward

CoinShares enters 2025 with a strong foundation: a proven business model generating consistent profitability; established platforms across Europe and the US; and clear opportunities arising from continued institutionalisation of digital assets.

The year ahead will bring challenges such as intensified competition and evolving regulatory landscapes (positively influenced by Markets in Crypto Assets Regulation (MiCA) in Europe). However, our diversified revenue streams, operational expertise, and strategic agility position us well to continue navigating these developments effectively.

I extend my gratitude to our shareholders for your continued trust and support as we build on our achievements. I also thank our team members whose expertise drives our success daily.

CoinShares is well-prepared for its next phase of growth as we continue executing on our mission to deliver innovative digital investment solutions globally.

Sincerely,

Jean-Marie Mognetti

Co-Founder and Chief Executive Officer

‌SUMMARY OF FINANCIAL PERFORMANCE

Selected financial information derived from the audited consolidated financial statements of the Group is disclosed below. The full-form audited financial statements, including notes and as prepared under IFRS are included within section 9 of the annual report.


Group Performance	Year ended	Year ended
	31 December 2024 £	31 December 2023 £
Asset management revenue	87,206,045	42,954,234
Capital markets gains & income	57,026,894	32,820,367
Principal investments gain/(loss)	(17,747,473)	3,693,062
Total revenue, gains and other income	126,485,466	79,467,663
Direct costs	(13,379,248)	(5,687,494)
Administrative expenses	(32,415,209)	(22,909,758)
Non-recurring income	28,787,099	-
Adjusted EBITDA	109,478,108	50,870,411
EBITDA (%)	87%	67%
Depreciation/amortisation	(2,360,134)	(3,202,933)
Adjusted EBIT	107,117,974	47,667,478
Finance expense	(2,379,354)	(504,978)
Taxation	(731,452)	(573,670)
Net Profit	104,007,168	46,588,830
Currency translation differences	3,174,922	(8,192,795)
Total comprehensive income	107,182,090	38,396,035
2024 Overview

We entered 2024 with strong momentum, building on the stability of 2023. The Group consistently delivered robust quarterly EBITDA, marking 2024 as one of our most successful years to date. While market conditions were favourable, the strength of our individual business units played a crucial role in driving performance. A disciplined approach to cost management and operational efficiency enabled us to achieve significant profitability, leading to a material increase in the Group’s net asset value.

While costs have increased, the ability to sustain top-line growth demonstrates the scalability and efficiency of our business model, reinforcing our long-term financial strength.

It is worthwhile acknowledging two key events that occurred during Q2 2024 that materially impacted the financial performance of the Group for the year, both positively and negatively.

On the positive side, we achieved a successful sale of our FTX claim which we had provisioned against in full during 2022. The sale resulted in the recognition of non-recurring income of £28.8 million and led to a special dividend for shareholders to acknowledge their loyalty for staying with us since the turbulence experienced during 2022.

On the negative side, On June 13, 2024, the Swiss Financial Market Supervisory Authority (FINMA) initiated bankruptcy proceedings against FlowBank SA, which was a material holding for the Group within its Principal Investments portfolio. In response, we elected to fully impair this investment, resulting in an impairment charge of £21.8 million, which has contributed to the Principal Investments loss of £17.8 million for the year.

While the net impact of these two events was positive, the resultant focus on improving the Group’s risk framework is the core benefit that we take from these events.

Asset Management

Our Asset Management business unit had a standout year, generating £87.2 million in management fees, doubling the £43.0 million recorded in 2023. The final quarter alone contributed £25.3 million, marking both our strongest quarter and month (December) on record. While price action remained the primary driver of growth, the ongoing diversification of our product offering has been instrumental in strengthening performance (see Asset Management section). CoinShares Physical had a particularly strong year, posting record management fees of £16.7 million (2023: £2.7 million). This was driven in part by the introduction of staking capabilities on the CS Physical Ethereum product.

In addition, our strategic shift away from reliance on CoinShares XBT Provider as the dominant revenue generator continues to progress. While XBT Provider still accounted for 77% of overall management fees this is significantly down from 92% in 2023. Despite this proportional decrease, AUM in XBT Provider increased by 59.7% over the year, closing at $3.75 billion (£2.98 billion).

The acquisition of Valkyrie’s ETF business has further enhanced our position in the US market, adding four ETFs with a December 2024 closing AUM of $606.2 million (£483.3 million). The platform is already profitable at the gross margin level, generating a healthy £1.7 million in fees since the acquisition.

Despite expanding our team and taking on associated costs following the Valkyrie acquisition, our administrative expenses within Asset Management remain lean compared to industry peers, reinforcing the scalability of our model. The overall net inflows across our product suites, combined with market movements, resulted in external AUM rising from £3.01 billion to £5.50 billion over the year.

Capital Markets

The Capital Markets business unit also delivered strong performance, with total income and gains reaching £57.0 million, up significantly from the prior year. Staking continued to be a major contributor, complemented by trading gains from well-executed strategies, stable lending activities, and liquidity provisioning which has capitalized on the flows seen within the market as result of volatility, particularly during Q4.

Throughout the year, we remained focused on enhancing the resilience of the Capital Markets division, ensuring stable performance amid evolving market conditions. The division’s ability to generate sustainable returns while maintaining a prudent approach to capital allocation and leveraging our technological edge underscores the maturity of our trading operations.

It is noted that the topline performance for Capital Markets includes gains on the Group’s newly established BTC treasury position. Moving forward this will be tracked separately from Capital Markets. It is important that we report clearly the recurrent revenue generated by the Capital Markets team across a range of market conditions to ensure that business line attracts the multiple it deserves, with performance not being impacted by passive gains or losses on our growing treasury position.

In Conclusion

With a solid year behind us, the Group remains well-positioned to capitalize on future opportunities. Our diversified revenue streams, cost control, continued investment in innovation and our team all provide a strong foundation for sustainable growth.

As we move into 2025, we remain focused on delivering value to our stakeholders and further expanding our leadership in the digital asset industry.

Accounting Policy Change

While the quantitative aspects of the Group’s financials clearly demonstrate the successes seen in the year, a key development during 2024 which is more qualitative in nature addresses the Group’s accounting policy for digital assets which was amended in Q3.

Prior to the change, digital assets were classified as intangible assets. Following the change, the digital assets of the Group are classed as either:

Inventory (IAS 2); or
Intangible assets held as collateral and subject to hedge accounting (IFRS 9).

The full details of these changes and resultant restatement of the 2023 comparative financial infor- mation are included within the full-form audited financial statements within this report. However, it is important to explain the key impact of this change and how it has fundamentally improved the clarity of the Group’s financial statements.

Before these changes were made, the classification of digital assets as intangible assets (IAS 38) resulted in large movements in other comprehensive income to reflect the change in fair value of the Group’s holdings. In turn this resulted in a net profit/loss after tax figure on the face of the Statement of Comprehensive Income that was not reflective of the financial performance of the Group.

Following the change, the resultant profit after tax figure of the Group is:
An accurate reflection of the financial performance of the Group;
Readily understandable by a wide range of users;
Remains presented in accordance with IFRS; and
Easily reconcilable to the Group’s EBITDA figure.

There has been no change in the Group’s approach to calculating its EBITDA figure, nor has this resulted in any change in the Group’s total comprehensive income.

Historical Quarterly Performance 2021 - 2024

£65m £26.61m

£33.42m

£33.58m

£33.23m

£34.19m

£34.18m

£32.14m

£28.60m

£26.13m

£18.75m

£24.17m

£15.44m

£11.42m

£8.28m

£6.29m £7.01m

Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024

-£8.21m

£55m

£45m

£35m

£25m

£15m

£5m

£(5m)

£(15m)

£(25m)

-£23.59m

Asset Management Platform Capital Markets Infrastructure Principal Investments EBITDA


Summary Statement of Comprehensive Income
	Year ended	Year ended
	31 December 2024 £	31 December 2023 £
Revenue	87,332,805	43,082,721
Cost of sales	(13,379,248)	(5,687,494)
Gross profit	73,953,557	37,395,227
Administrative expenses	(34,775,343)	(26,112,691)
Other operating income	34,090,608	27,274,329
Gain on digital assets & financial instruments	1,919,389,797	1,286,677,272
Loss on certificate liability	(2,396,252,307)	(1,470,485,132)
Other operating gains/(losses) through profit and loss	502,477,326	191,994,105
Operating profit	98,883,638	46,743,110
Non-recurring income	28,787,099	-
(Loss)/gain on investments	(20,200,611)	775,186
Net finance costs	(2,379,354)	(504,978)
Profit before tax	105,090,772	47,013,318
Taxation	(731,452)	(573,670)
Profit after tax	104,359,320	46,439,648
Other comprehensive income
Exchange differences on translation of foreign operations	3,174,922	(8,192,795)
Fair value gain on financial assets	(352,152)	149,182
Total other comprehensive income/(loss)	2,822,770	(8,043,613)
Total comprehensive income	107,182,090	38,396,035
Summary Balance Sheet	As at	As at
	31 December 2024 £	31 December 2023 £
Assets
Investments	19,998,654	44,924,207
Other non-current assets	15,662,739	17,595,540
Non-current assets	35,661,393	62,519,747
Cash and cash equivalents	19,859,572	25,507,944
Digital assets	3,627,205,737	2,375,850,359
Other current assets	1,116,334,406	268,334,978
Current assets	4,763,399,715	2,669,693,281
Total assets	4,799,061,108	2,732,213,028

Liabilities
Certificate liability	(4,171,982,360)	(2,351,475,523)
Other current liabilities	(281,144,128)	(110,330,883)
Trade and other payables	(10,523,355)	(5,612,218)
Current liabilities	(4,463,649,843)	(2,467,418,624)
Non-current lease liabilities	(1,801,699)	(2,404,272)
Non-current loans	(19,654,267)	(23,145,127)
Non-current liabilities	(21,455,966)	(25,549,399)
Total liabilities	(4,485,105,809)	(2,492,968,023)
Net assets	313,955,299	239,245,005

‌COINSHARES ASSET MANAGEMENT

2024 OVERVIEW

2024 was a pivotal year for the digital asset management industry, with the historical approval of the Bitcoin and Ethereum spot ETFs by the SEC, signalling a new era of digital asset integration into regulated financial markets.

2024 saw record net inflows globally, at an amount almost 5x the prior record set in 2021. The US obviously experienced the most flows, as a direct result of the SEC approvals, at $48.1 billion. Europe, however, saw net outflows, mainly due to profit taking as well as large institutions switching from European ETPs to US ETPs.

Nevertheless, price appreciation drove European digital asset ETP AUM to $16.7 billion by the end of 2024, compared to $8.9 billion at the start of 2024. The US digital asset ETP AUM closed the year at an impressive $129.6 billion, having started the year at $34.1 billion.

In terms of asset mix, flows were once again dominated by Bitcoin, which saw $41.6 billion of inflows, while Ethereum saw a resurgence in late 2024, bringing full year inflows to $5.3 billion.

XRP has dominated the European ETP altcoin market in terms of flows, especially towards the end of 2024, with around $490 million inflows in European XRP ETPs. Although it is difficult to identify the source of these flows, we believe they are (at least in part) driven by hopes that the Trump administration might seek a timely resolution of the long-lasting dispute between the SEC and Ripple.

Assets Under Management & Flows

Total external AUM of the Group as at 31 December 2024 amounted to £5.50 billion, having increased over the course of the year by approximately 82%, due to a combination of flows, price appreciation and product diversification, namely the acquisition of Valkyrie in Q1 2024.

Total Group AUM

6,000m

£5,495m

£4,770m

£4,183m

£3,714m

£3,948m

£4,192m

£3,816m

£3,360m

£3,013m

£2,219m

£1,737m

£2,016m

£1,662m

£2,135m

£2,143m

£1,982m

£1,440m

£720m

£571m

£380m

5,000m

4,000m

3,000m

2,000m

1,000m

Q1 Q2

Q3 Q4 Q1

Q2 Q3 Q4 Q1

Q2 Q3 Q4

2020 2020 2020 2020

2021

2022

2023

2023 2024 2024 2024 2024

CoinShares XBT Provider CoinShares Physical Block Index Valkyrie Total AUM

The diversification seen across our Asset Management platform continues to evolve, with the Group becoming less reliant on CoinShares XBT Provider over time.

Percentage of overall AUM represented by CoinShares XBT Provider now stands at 54%, compared to 62% as at the start of 2024. Again, this is due to the balance of flows across the various CoinShares products, as evidenced below.

2024 net flows of our Asset Management business line


08
	Performance
		Year ended 31 December 2024 £	Year ended 31 December 2023 £
	CoinShares XBT Provider	67,098,615	38,815,487
	CoinShares Physical	16,703,913	2,741,926
	Block Index	1,731,623	1,396,821
	CoinShares Valkyrie	1,671,894	-
	Total	87,206,045	42,954,234
	Direct costs	(7,522,442)	(3,203,771)
	Gross Profit	79,683,603	39,750,463
	Gross profit margin	91%	93%
	Administrative expenses	(6,781,256)	(4,288,454)
	Operating Profit	72,902,347	35,462,009
	Operating profit margin	84%	83%
	The events of 2024 contributed	to the Asset Management business	unit’s strongest annual

performance from a revenue standpoint at £87.2 million, with Q4 also being the strongest quarter on record.

We continue to move towards our goal of placing less reliance on CoinShares XBT Provider as the primary source of management fees for the Group. It now represents 77% (2023: 92%) of overall fees within the business unit.

The profit margin of the Asset Management Platform as a whole remains very healthy, although has declined marginally vs. 2023, particularly within Q4. This is due to increased issuer costs as a result of the Valkyrie acquisition, totalling £1.4 million for the year, and allocated at the end of year to direct costs following progress in the ongoing integration of Valkyrie into the Group.

Admin costs have shown a year-on-year increase due to growth of the team (again, primarily due to the addition of Valkyrie) and certain associated costs, but still remain low compared to our peers, demonstrating the lean nature of the costs base and scalability of the overall platform.

CoinShares Physical

2024 was a record year for CoinShares’ Physical ETP platform, our strongest year in terms of revenue, with the platform generating £16.7 million in management fees over the year, representing an eight- fold increase on 2023.

In terms of flows, CoinShares Physical product range experienced a strong year, with around $616 million of gross inflows, offset by large outflows from institutional investors migrating to US-based products in early January 2024, as well as higher than average redemptions due to profit taking towards the end of the year. CoinShares Physical had net positive inflows of $159 million in 2024.

Assets of the CoinShares’ Physical platform increased by 124% in 2024, closing the year at $2.3 billion (inclusive of seed investment of $632 million) just after reaching its all-time high at $2.7 billion mid- December. CoinShares Physical Bitcoin achieved the historical milestone of becoming Europe’s largest physical Bitcoin ETP in Europe in 2024.

This success is the combination of price appreciation and continuous product development and distribution efforts.

In Q3 2024, we launched a new multi-asset ETP, the CoinShares Finanzen.net Top 10 Crypto ETP, marking the completion of a partnership with the largest platform for German-speaking financial and investment news, finanzen.net. The CoinShares finanzen.net Top 10 Crypto ETP, issued from our CoinShares Physical platform, aims to replicate a diversified index developed in collaboration with finanzen.net and the expert index provider Compass Financial Technologies. It provides a diversified exposure to major cryptocurrencies while allowing investors to benefit from staking rewards generated by the underlying positions. By partnering with finanzen.net, we aim to enhance our visibility and leverage the power of a respected media brand in the German retail market, which is still one of the core markets for our physical ETP platform.

Finally, on 1st February 2024, we reduced the management fees for CoinShares Physical Bitcoin (ticker: BITC) to 0.35% p.a, a reduction that we believe helped the product become Europe’s largest physical Bitcoin ETP by AUM. In January 2025, we further reduced the fees to 0.25%, reinforcing BITC’s leading position in Europe and aligning the fee structure with the Company’s US-listed CoinShares Valkyrie Bitcoin ETF (NASDAQ: BRRR).

CoinShares Valkyrie

In the US, the sustained positive sentiment around the US Bitcoin and Ethereum spot ETFs following approval by the SEC earlier this year and the pro-crypto outcome of the US elections towards the end of the year benefited our US business, resulting in net inflows of $640.6 million and £1.7 million of revenue for the year.

Flows were primarily allocated between our Bitcoin spot ETF (BRRR) with $519 million of net inflows in 2024 (amongst which $239 million is seed capital from CoinShares) and the CoinShares Valkyrie Bitcoin Miners ETF (WGMI) with $101 million of net inflows in 2024.

WGMI, our Bitcoin mining equity ETF in the US, had a record year in 2024, raising $101 million, $52 million just in Q4 alone. The ETF delivered a total return of 23.28% in 2024, growing its total assets from $100 million at the end of 2023 to $196 million at the end of 2024. This is the result of a resilient growth in the Bitcoin mining sector despite challenges in 2024 related to the blockchain’s reward reduction moment in the spring and persistent volatility tied to the US election year. Bitcoin miners have utilized innovation in their established connectivity to the power grid by transitioning to AI/HPC strategies, diversifying revenue streams. This power access is a scarce asset in the US, and Bitcoin mining companies will continue to lead in the next generation process of capturing necessary power requirements for future application.

Our US distribution effort is underway in both advisor and retail markets with added staff in Q4 who have generated good early results. 2025 will see us scale those efforts as we identify high return on capital tactics in those market segments, as well as enhance our product range with the intention to file for several spot ETFs in 2025.

CoinShares XBT Provider

CoinShares XBT Provider (renamed in June to align more closely with the CoinShares group strategy) continued to experience net outflows in 2024 totalling $774 million.

Such outflows have however been more than off-set by price appreciation, with the AUM of the certificates up by 57% in 2024 to end the year at $3.74 billion.

As previously announced, we continue to view Sweden and the Nordics as an important market for CoinShares and are looking to expand our product range in the near future. In preparation, we identified the need to enhance the perception of digital assets among Swedish investors and strengthen CoinShares’ brand association in this market. We executed a comprehensive above the line campaign encompassing wild postings, metro billboards, cinema advertisements, influencer partnerships, and digital displays. The campaign’s strategy was to reshape perceptions of digital assets while delivering educational content about crypto’s portfolio benefits. The results were compelling, achieving a significant increase in impressions, clicks and high quality sessions evidencing solid engagement metrics. This successful brand building campaign has established a strong foundation and engaged audience base.

The Blockchain Global Equity Index

The CoinShares Blockchain Global Equity Index (BLOCK Index) had a total return of 22.3% in 2024, outperforming broader equities (MSCI World NTR), which increased by 18.7%. Performance was influenced by a surge in technology and crypto-focused equities triggered by the approval of spot Bitcoin ETF listings in the US earlier in the year as well as the crypto rally triggered by the election of President Donald Trump.

During 2024, assets managed under the CoinShares Blockchain Global Equity Index strategy rose to

$821.3 million, up from $733.5 million at the end of 2023.

2025 OUTLOOK

After what will be remembered as a pivotal year for the crypto asset management industry, we believe 2025 should continue at the same pace. In the US, we expect that additional altcoin ETFs should receive SEC approval in 2025, albeit likely at a slower pace than the market’s expectations. Solana, XRP and Litecoin appear good candidates, but filings have already been made for many more, including the likes of DOGE, TRUMP, BONK or HBAR.

The global market for crypto ETFs and ETPs is set for strong growth in 2025, driven by increasing institutional adoption, regulatory clarity, and the success of spot Bitcoin ETFs in the US following their 2024 approvals.

Although the market was largely driven by US related news in 2024, we still believe that Europe has a strong role to play in accelerating crypto adoption in the coming years and it will remain central to our business. The European crypto asset management market is very mature, with nearly 200 crypto ETPs, a strong breadth of underlying exposures not available yet in any other part of the world, and basket and staked ETPs which are still a unique way for investors to benefit from enhanced diversification and additional source of revenue. The final implementation phase of MiCA should bring another degree of regulatory stability and comfort for investors across Europe, and we expect some historically reticent European markets to open up to crypto regulated products in 2025.

Overall, we are convinced that crypto ETFs and ETPs are likely to become a mainstream component of diversified portfolios, and we will continue ensuring that our product range is well positioned on both sides of the pond to address such demand.

‌COINSHARES CAPITAL MARKETS

2024 OVERVIEW

Crypto markets started 2024 in an ebullient manner as the imminent approval of the first Bitcoin ETFs loomed, with the SEC finally providing their approval on 10 January. The success of these ETFs has been nothing short of extraordinary, with the iShares Bitcoin Trust (IBIT) reaching $50 billion of assets under management within 11 months, making it the most successful ETF debut in history.

Corporate acquisitions of Bitcoin accelerated over the course of 2024, with MicroStrategy leading the charge and acquiring 447,470 as at the end of December 2024. MicroStrategy’s CEO, Michael Saylor, displayed a naked ambition to continue to raise funds solely for the purpose of acquiring as much Bitcoin as possible. MicroStrategy capital markets activity extended to the issuance of convertible bonds which was readily received by bond markets and opened the door for other issuers to follow. The impact of opening a further front in BTC adoption to convertible bonds traders should not be underestimated; total issuance for 2024 for Crypto related names was $16.7 billion. Highlights include Marathon Holdings issuing $1 billion of Convertible notes on 18 November and Riot Platforms issuing

$594.4 million an offering of Convertible notes to acquire Bitcoin on 16 December. Addition of BTC to the balance sheet of companies and sovereign nations is a trend which looks likely to persist into 2025.

The combined impact of continued corporate adoption and giving access to a swathe of US retail investors without fear of handling private keys or concerns of regulatory censure propelled Bitcoin’s price to an All-time-high of approximately $108,400 on 17 December. Such conditions provided ample market opportunities for CS Capital Markets to generate trading profits as volatility re-entered the market.

The transition from our legacy trading platform ‘Emergence’ to our latest iteration ‘MATRIX’ was successfully completed during the year, which has drastically improved our ability to scale with volume and run an increasing high number of concurrent strategies. Execution on our historically profitable strategies has improved, allowing us to remain competitive versus a wave of new market entrants, and the number of Quantitative Strategies we are running continues to grow over time, with several additional strategies ready to be deployed in early 2025.

Risk management continues to remain a strong focus, and we entered into a number of additional account control agreements with our trading counterparties to mitigate exchange risk, a process that commenced in earnest in 2023 yet still remains a key priority for us. Counterparty risk management, along with the adoption of Haruko as our Portfolio and Risk monitoring system has led us to be more effective in monitoring our real-time risk. As such, we are well positioned to grow trading profits in a sustainable and scalable manner.


Performance
£	Year ended 31 December 2024	Year ended 31 December 2023
Liquidity Provisioning	7,470,067	1,446,479
Delta Neutral Trading Strategies	12,667,241	5,009,488
Digital Asset Lending	7,347,846	3,733,685
Staking	23,026,213	20,425,784
Other	6,515,527	2,204,932
Total	57,026,894	32,820,367
Direct costs	(5,793,419)	(2,248,513)
Non-recurring income	28,787,099	-
Gross Profit	80,020,574	30,571,854
Gross profit margin*	90%	93%
Administrative expenses	(3,676,993)	(3,470,721)
Operating Profit	76,343,581	27,101,134
Operating profit margin*	83%	86%

* Gross/operating profit margin excluding non-recurring income

Performance in all areas have shown growth versus 2023. Digital Asset Lending benefitted in 2024 as we continued to see demand from market makers handling creation and redemption of the newly launched ETFs and hedge funds looking for borrow to facilitate short-term tactical trades. We have continued to be extremely selective in who we lend to, with only three new borrowers meeting our selection criteria and due diligence checks.

Liquidity Provisioning revenue increased five-fold as market volumes exploded, with new entrants looking to take position whilst the faithful class of yesteryear sought to book profits. Unsurprisingly, the majority of revenue was clustered around the two upside price surges. The first Q1, when Bitcoin surpassed its previous all-time high of circa $69,000 achieved in November 2021, and the second Q4, when Bitcoin achieved broke the key $100,000 barrier and achieved its all-time high.

Our staking revenue increased year on year, even though average staking rewards on a yield basis declined with an increasing number of validators securing the network. Part of this increase in fiat terms is due to the underlying price appreciation of Ethereum, and part is due to a shift to a more dynamic management of the proportion of assets staked. Efficiency which has been improved through the collateral management improvements available to us through use of the tripartite account control agreements as alluded to earlier in this section of the report.

Our delta-neutral trading strategies delivered solid performance for shareholders, effectively doubling year-on-year. Our continued presence on the CME and growth of the market continued to materially drive profitability, and the volatility generated on offshore exchanges by virtue of annualised basis premiums yielding over 20% provided continued dislocations across markets and therefore arbitrage opportunities.

Other gains generated in the year include those on the Group’s BTC treasury position, which stood at 163 BTC as at the end of the financial year.

Gains/losses on the treasury BTC will be tracked separately from Capital Markets moving into 2025. It is important that we report clearly the recurrent revenue generated by the Capital Markets team across a range of market conditions to ensure that business line attracts the multiple it deserves, with performance not being impacted by passive gains or losses on our growing treasury position.

Volume

Our trading volumes in 2024 increased year-on-year from $8.8 billion in 2023 to $10.5 billion in line with increased opportunities and broader market participation, supported by the technological improvements delivered via the MATRIX platform. As a bellwether of the continued institutional adoption, Open Interest on the CME achieved a high of 218,000 Bitcoin in November 2024, and we expect this to continue to grow.

2024 Volume Traded $ million

Millions

$1,400

$1,200

$1,000

$800

$600

$400

$200

Jan-24 Feb-24 Mar-24 Apr-24 May-24 Jun-24 Jul-24 Aug-24 Sep-24 Oct-24 Nov-24 Dec-24 ETN Physical Derivatives

2025 Outlook

The continued adoption of Bitcoin as a corporate treasury asset and the increasing accessibility of ETFs will continue to be supportive for the market as a whole but with it will come differences in the way in which the market operates. The dominance of the US ETFs is likely to continue to cluster trading volumes during US market hours. As such, we expect that Bitcoin will likely become more closely correlated to traditional markets, as it begins to form a part of an increasing number of investment portfolios. Similarly, we expect to see a proliferation of structured products develop with US spot ETFs as the underlying reference asset. We believe volatility will be cyclical but with a reduced risk of downside volatility from regulatory action, and continued growth in the options market.

As part of our long-held view, we remain confident that those who will weather these market changes best are those firms which can straddle both traditional finance and crypto markets themselves. We continue to focus our efforts on developing options trading strategies across both markets, as we believe that the rising tide of digital asset ETFs will lift all other crypto ships, as demonstrated by the continued growth of open interest on Deribit, and growing volumes and open interest on the newly listed options on ETFs.

We expect the lending market to continue to evolve as the growing number of corporate treasuries look to seek yield on their crypto holdings. As such, we will continue to be nimble and look to improve our existing lending facilities to continue to cement our position as a market leading lender of quality, whilst still remaining extremely selective as to who we choose to lend to.

We will build upon our existing quantitative trading strategies and look to implement a number of further alpha generating strategies which are currently in the testing phase, which will help to further increase our trading volumes, and continue to invest in MATRIX in order to support an ever increasing number of strategies deployed in the market at any given time.

Whilst significant improvements continue to be made to our risk management architecture and infrastructure, we are not complacent and will continue to keep risk management at the forefront of our minds as we embark on a year of new opportunities to create value for shareholders.

‌2025 CRYPTO MARKET OUTLOOK

The Bitcoin Triumvirate: Balancing Economic Uncertainty, Geopolitics, and Tech Evolution

Bitcoin continues to solidify its position as a multifaceted asset, balancing its role as an emerging store of value, a hedge against the US dollar, and a technology-driven investment. Over the past year, Bitcoin correlation with traditional risk assets, such as equities, has intermittently broken down, highlighting its unique characteristics. Historically, Bitcoin has maintained a negative correlation with the US dollar, making it an attractive investment during periods of dollar weakness and heightened economic uncertainty.

Bitcoin vs the US Dollar Vs Nasdaq

Economic factors are also critical. Recent US monetary policy decisions, including a gradual shift towards easing, have buoyed Bitcoin’s appeal. The Federal Reserve’s readiness to cut interest rates amid stable inflation and steady jobless claims has created a “Goldilocks” scenario. However, fiscal conservatism under the Trump administration introduces new variables, with proposed measures like the establishment of a “Department of Government Efficiency” aiming to curtail spending. Bitcoin’s inherent resistance to inflationary pressures positions it as a potential beneficiary in such scenarios.

Geopolitically, Bitcoin’s decentralized nature offers resilience amid global tensions. For instance, discussions within the BRICS nations around adopting alternative currencies, including Bitcoin, underscore its expanding influence. Moreover, rising energy prices due to potential Middle Eastern conflicts could further elevate Bitcoin’s value as a form of “digital stored energy.”

Bitcoin’s Record-Breaking Inflows Signal Shift, but Price Surges Remain Elusive Amid Policy and Political Headwinds

Institutional adoption of Bitcoin saw unprecedented growth in 2024, driven largely by the approval of Bitcoin spot ETFs. Total inflows into Bitcoin ETFs reached $48.7 billion by the end of the year, over four times higher than previous years. Bitcoin’s price stood at $92,643.25 as of 31 December 2024, having peaked at around $108k during 2024, defying expectations of a price surge commensurate with these inflows.

Bitcoin ETF Demand vs Supply

This disconnect can be attributed to delayed shifts in US monetary policy, lingering regulatory uncertainty, and a slow rollout of ETF trading by platforms. Additionally, selling pressure from Grayscale’s closed-end fund holders, who offloaded $18.9 billion worth of Bitcoin, has tempered price growth.

Looking ahead, potential policy clarity under the Trump administration and increased institutional adoption could act as catalysts for a sustained price rally. As of December 2024, if the top 20 countries with strategic reserve assets in gold all sold 5% of those reserves to diversify into Bitcoin, this would equate to $110 billion of buying pressure for 5.5% of total supply, as can be seen from the illustrative example below.

Gold & Notional Bitcoin holdings


Country	Gold Reserves (tonnes)	$ billion	5% BTC ($ billion)
US	8,133	692	35
Germany	3,352	285	14
Italy	2,452	208	10
France	2,437	207	10
China	2,264	193	10
Switzerland	1,040	88	4.4
India	854	73	3.6
Japan	846	72	3.6
Netherlands	612	52	2.6
Turkey	595	51	2.5
Taiwan. China	423	36	1.8
Poland	420	36	1.8
Portugal	383	33	1.6
Uzbekistan	374	32	1.6
Saudi Arabia	323	27	1.4
United Kingdom	310	26	1.3
Kazakhstan	286	24	1.2
Spain	282	24	1.2
Austria	280	24	1.2
Thailand	235	20	1.0
		2,202	110

US Poised for Major Crypto Overhaul Under Trump

The 2024 election of Donald Trump for President has set the stage for a transformative era in US crypto regulation. Trump’s administration, alongside Vice President-elect J.D. Vance, has outlined a pro- crypto agenda focusing on innovation, investment, and financial sovereignty. Key initiatives include:

the replacement of SEC Chairman Gary Gensler and anti-crypto commissioners, fostering a more favourable regulatory environment for digital assets;
support for stablecoins as tools to bolster the US dollar’s dominance;
the promotion of Bitcoin mining as a strategic national priority, with promises to retain all government-held Bitcoin in a strategic reserve; and
more recently there have been rumours of a US-focused crypto reserve such as XRP and Solana.

These policies are expected to ignite new projects within the ecosystem and M&A activity within the crypto sector and provide clarity for traditional financial institutions to deepen their involvement.

The Rise of Bitcoin Yielding Companies

Corporate adoption of Bitcoin as a treasury asset is expanding, with firms like MicroStrategy pioneering strategies that yield returns on Bitcoin holdings. As of December 2024, MicroStrategy held 450,000 BTC, valued at nearly $45 billion, at the prevailing market price of $100k as of 17 January 2025. Other companies, such as Block and Marathon Digital, have adopted similar strategies, leveraging Bitcoin- backed loans and convertible notes to enhance their reserves.

This trend is further supported by regulatory advancements. The SEC’s decision to classify Bitcoin as an asset has enabled companies to present more favourable financial positions and leverage Bitcoin for yield-generating opportunities. With corporate Bitcoin holdings exceeding 900,000 BTC, this momentum is expected to accelerate into 2025.

Corporate Bitcoin Balances (Ex Bitcoin Miners)


	Bitcoin held	Total Bitcoin / Market cap
MicroStrategy	331,200.0	26.45%
Tesla	9,720.0	0.09%
Coinbase	9,480.0	1.23%
Block Inc	8,363.0	1.43%
Galaxy Digital	4.000.0	6.87%
Bitcoin Group	3.589.0	112.30%
Nexon	1,717.0	1.43%
Metaplanet	1.142.0	16.11%
Semler Scientific	1,012.0	27.36%
MercadoLibre	412.7	0.04%

Source: BitcoinTreasuries.net, Bloomberg, CoinShares, data available as at 22nd November 2024

Bitcoin Mining Booms with Debt, M&A, and Clean Energy

The Bitcoin mining sector is undergoing significant transformation, driven by increased access to debt markets, strategic M&A, and a shift towards clean energy. Miners raised over $5.2 billion through convertible note offerings in 2024, leveraging Bitcoin’s rising value as collateral. These fundraising efforts have provided miners with the liquidity needed to upgrade equipment, expand facilities, and optimize operations, ensuring they remain competitive in an increasingly challenging environment.

Miner Financing ($ million)

Environmental considerations are a pivotal factor in the industry’s evolution. A growing number of miners are transitioning to clean energy sources, including hydroelectric power, wind, and solar, to mitigate their carbon footprint and appeal to environmentally conscious investors. Partnerships with renewable energy providers and participation in demand response programs have further strengthened the sector’s alignment with global sustainability goals. These initiatives not only enhance miners’ reputations but also lower operational costs, providing a dual benefit.

In addition to shifting energy sources, miners are actively investing in energy efficiency technologies to reduce environmental impact. Immersion cooling systems, which significantly cut down energy consumption by efficiently cooling mining hardware, are becoming industry standard. AI-powered optimization tools are also being implemented to monitor and dynamically adjust energy usage, further decreasing environmental impact.

Furthermore, collaborations with renewable energy projects are transforming miners into key players in the green energy sector. Some mining firms are now investing directly in renewable energy infrastructure, such as solar farms and wind turbines, to secure long-term energy supplies while contributing to the transition away from fossil fuels. Others are leveraging waste energy, such as natural gas flaring, to power operations—a solution that not only prevents waste but also reduces emissions.

The convergence of financial innovation, environmental commitment, and technological advancements positions Bitcoin mining as a model for how industries can adapt to climate challenges while remaining profitable. As this trend continues, Bitcoin miners are set to become central figures in the push toward a sustainable energy future.

Ethereum Set for Pectra Upgrade in 2025

On the token front, Ethereum’s long-anticipated Pectra upgrade, slated for Q1 2025, marks a pivotal moment for the blockchain. The centrepiece of this upgrade, EIP-7251, increases the maximum effective balance for validators from 32 ETH to 2048 ETH. This change aims to enhance scalability, reduce network congestion, and pave the way for single-slot finality, significantly improving transaction speeds.

While the upgrade introduces short-term challenges, such as reduced fee revenues, it represents a critical step towards Ethereum’s rollup-centric roadmap. By optimizing data availability and scalability, Ethereum is positioning itself for widespread adoption across diverse use cases.

Source: @Hildobby (Dune Analytics)

Number of Validators

Speed Unleashed: The Parallel Revolution

Blockchain networks are embracing parallelization to address scalability challenges, with Solana leading the charge. Innovations like Firedancer, a next-generation validator client, promise to boost Solana’s throughput to unprecedented levels. However, parallelization introduces complexities, including consensus and decentralization trade-offs.

Looking ahead, the successful implementation of parallelization strategies could position blockchain networks as viable infrastructures for global financial systems. Specialized hardware and advanced consensus mechanisms are expected to play a critical role in overcoming these challenges.

Our Summarised Outlooks

As cryptocurrency continues to mature, major financial institutions, corporations, and regulatory bodies are poised to play a more active role, potentially pushing Bitcoin and blockchain technologies into wider, mainstream applications.

Looking ahead, the cryptocurrency landscape shows several forward-looking trends that are likely to shape 2025 and beyond:

Growing Bitcoin Adoption Through ETFs and Institutional Investment: Record breaking inflows into Bitcoin ETFs in 2024 signal institutional appetite that could surge further as more platforms integrate access and regulatory clarity emerges. If Bitcoin gains broader portfolio acceptance, inflows could continue growing, potentially pushing Bitcoin closer to mainstream financial markets as a strategic asset.

Policy Shifts Could Shape Market Dynamics: US policy decisions remain a wildcard. The expected pro-crypto administration formed by the Republicans could prioritise supportive regulation, boosting both Bitcoin mining and broader market confidence.

Debt and Clean Energy to Drive Mining Expansion: Bitcoin miners are increasingly utilising debt markets and clean energy sources to scale operations, positioning them for strategic growth as costs decrease and environmental pressures mount. The trend toward clean energy mining is likely to attract further AI and tech sector partnerships, which could reshape mining as a cornerstone of green energy use cases.

Blockchain Scaling Technologies to Enhance Adoption: Innovations such as Solana’s Firedancer and Ethereum’s Layer 2 upgrades aim to unlock new transaction efficiencies, potentially setting the stage for mass adoption in enterprise and financial services. With institutional players launching their own Layer 2 solutions, the coming year could see broader blockchain integration across industries, leveraging improved transaction speed and cost-efficiency.

Corporate Treasury Integration and Yielding Strategies on the Rise: Companies are increasingly using Bitcoin as a treasury asset with yield-generating strategies, a trend likely to accelerate in 2025 as regulatory frameworks stabilise. This shift could see traditional firms not only hold Bitcoin but also leverage it to enhance liquidity and shareholder value, with Bitcoin yielding strategies becoming a new corporate finance norm.

2025 Regulatory Outlook

US:

The US Congress is now more pro-crypto than ever, largely due to the influence of pro-crypto lobbyists—A16Z, Ripple, and Coinbase—who rank as the 15th, 16th, and 21st largest contributors to the election, respectively. While their contributions remain lower than those of Citadel or Susquehanna, they surpass those of Bloomberg, for instance. Additionally, crypto-exclusive Super PACs such as Defend American Jobs, Fairshake, and Protect Progress rank 8th, 13th, and 17th in total funds raised. This growing financial influence is likely to facilitate the passage of pro-crypto legislation in Congress.

The next 18 months, leading up to the mid-term elections—which could dilute the current Republican momentum—represent a critical window to secure regulatory clarity and establish the United States as the global leader in crypto innovation.

On Trump’s second day in office, he appointed Commissioner Mark Uyeda as Acting Chairman of the SEC, who immediately launched a Crypto Task Force that is focused on clarifying the regulatory status of crypto assets, particularly under securities laws, to address broader market uncertainties. Its objectives include identifying areas beyond the Commission’s jurisdiction, considering no-action letter requests, and potentially granting temporary relief for certain token offerings to facilitate transition periods before permanent regulations are established. The Crypto Task Force is also exploring modifications to registration pathways, such as Regulation A and crowdfunding, to enhance compliant token offerings. Key initiatives include updating the special-purpose broker-dealer framework, improving custody solutions for investment advisers, and clarifying regulations around crypto-lending and staking programmes. Additionally, the Crypto Task Force is working on approving crypto ETPs and considering regulatory modifications for staking and in-kind redemptions. Further areas of focus include the role of crypto in clearing agencies and transfer agents, as well as fostering international collaboration through a cross-border regulatory sandbox.

In the altcoin spot ETF landscape. Exchanges withdrew their SOL 19b-4 applications in December 2024 when the Gensler-led SEC signalled an unwillingness to engage. However, since the change in leadership, the SEC has now acknowledged these applications. More significant (in our view) than Solana’s acknowledgment are those of Dogecoin and XRP filings, as they indicate that the new SEC administration is seemingly more open-minded and not dismissing these products outright. The Solana spot ETF filing is considered the most likely to gain approval due to several factors:

High correlation across exchanges, reducing the risk of market manipulation.
Increasing SOL trading volumes on both centralised and decentralised platforms, reflecting its growing demand.
A rising institutional presence.

In March 2022, the SEC introduced Staff Accounting Bulletin (SAB) 121, which required entities to record a liability on their balance sheets for safeguarding crypto assets held for platform users. This was very unattractive for banks, brokers and custodians. On 23 January 2025, the SEC issued SAB 122, effectively repealing SAB 121, thereby allowing banks to hold crypto assets on behalf of clients. This could open the floodgates for adoption.

Other regulations include the well-known Financial Innovation and Technology for the 21st Century Act (FIT21), which aims to establish a federal regulatory framework for digital assets. It seeks to clarify the responsibilities of the SEC and the CFTC over digital asset products and transactions and update existing securities and commodity laws to accommodate blockchain applications, including decentralised protocols. FIT21 was initially a compromise designed to prevent the industry’s collapse, between the Republicans and Democrats, when Biden was in Office. The latest progress made was in September 2024, when it was received in the Senate, read twice, and referred to the Committee on Banking, Housing, and Urban Affairs. Now the Republican Party controls the House, Senate, and the Presidency, the legislative landscape has shifted. It is crucial to push FIT21 forward before the mid- term elections, which could weaken the GOP’s influence.

The CFTC has convened a CEO Forum with industry leaders to discuss the launch of a digital asset markets pilot programme for tokenised non-cash collateral, such as stablecoins. Participants include Circle, Coinbase, Crypto.com, MoonPay, and Ripple.

EU:

In late 2024, MiCA came into force across the European Union, establishing a comprehensive framework for crypto assets that goes beyond stablecoins to include e-money tokens (EMTs), asset- referenced tokens (ARTs), and crypto-asset service providers (CASPs). By mirroring elements of MiFID/MiFIR, MiCA brings higher standards of transparency and investor protection, requiring CASPs to obtain authorisation, meet capital requirements, manage market-abuse risks, and follow conduct-

of-business rules. At the same time, new reserve obligations for stablecoin issuers, particularly those operating outside the EU, may prompt some to curtail services rather than make extensive operational changes to comply with EU oversight.

In parallel, ESMA and the EBA have been finalising guidance and technical standards, harmonising how Member States handle market manipulation, custody practices, and capital adequacy. Larger crypto exchanges have pre-emptively adjusted to the new “passporting” system, which allows a single EU license to operate in all 27 Member States. Meanwhile, the EU’s Travel Rule (TFR) has introduced verification requirements for crypto transactions and introduced new friction for transfers to self custody wallets, though many banks and fintech firms appear prepared to adopt these measures to offer regulated crypto services.

Despite the regulatory clarity, the EU’s political climate on crypto remains cautious, with the ECB continuing to criticize Bitcoin and slow political will to embrace it. While advocates such as MP Sarah Knafo propose using Bitcoin reserves in place of a digital euro, these ideas have not garnered broad support, indicating that adoption within EU institutions may remain restrained. Nevertheless, the uniform regulatory regime established by MiCA—and its familiar, MiFID-inspired rules—lays the groundwork for a potentially significant expansion of regulated crypto activities across Europe in the longer term.

UK:

Throughout 2024, the United Kingdom has continued consulting on a more comprehensive crypto regulatory framework—an effort spearheaded by HM Treasury and the Financial Conduct Authority (FCA). While the stated ambition is to position the UK as a leader in digital assets, progress so far remains piecemeal. Existing legislation, such as the Financial Services and Markets Act (FSMA), has expanded the FCA’s scope to include crypto promotions and certain stablecoin activities, but many questions persist around consumer protection requirements, operational standards for crypto-asset service providers, and the precise classification of various token types. Nevertheless, in late 2024, the FCA approved the listing of crypto exchange-traded products (ETPs) on regulated exchanges, though these listings are restricted to professional investors, reflecting ongoing caution about retail exposure to digital assets.

Jersey:

Over in Jersey, the jurisdiction has continued to refine its crypto licensing regime in 2024 and has notably achieved a positive assessment in its MoneyVal review—an evaluation process conducted by the Council of Europe to assess anti-money laundering (AML) and counter-terrorist financing (CFT) measures. This strong performance underlines Jersey’s commitment to upholding robust regulatory standards, which helps maintain the island’s reputation as a responsible international financial centre. The Jersey Financial Services Commission (JFSC) has also signalled openness to crypto innovation, offering streamlined pathways for digital asset businesses that can demonstrate credible compliance and risk management. Such developments bolster confidence among both local and international stakeholders, contributing to Jersey’s growing appeal for crypto-related ventures seeking a well- regulated but innovation-friendly environment.

Switzerland:

Throughout 2024, Switzerland built on its well-established Distributed Ledger Technology (DLT) legal framework by introducing new licensing categories and clarifications under the Federal Act on the Adaptation of Federal Law to Developments in DLT. The Swiss Financial Market Supervisory Authority (FINMA) released further guidance detailing stablecoin reserve requirements and clarifying anti- money laundering (AML) obligations, particularly for cross-border DeFi activities. At the same time, the SIX Swiss Exchange authorised additional crypto exchange-traded products (ETPs).

Rest of the world:

Yet, this is a different story in the rest of the world. In Brazil, Congressman Eros Biondini proposed a bill to establish a Sovereign Strategic Bitcoin Reserve (RESBit), targeting 5% of Brazil’s international reserves to hedge against global risks. In Russia, Lawmaker Anton Tkachev proposed creating a national Bitcoin reserve to counter economic sanctions and ensure financial stability. We also predict China may rescind their Bitcoin mining ban, given our knowledge that a substantial (yet ‘underground’) share of global hashrate is located in that region. Also, Xi Jinping may want to position China as a leader in green energy and AI with the help of Bitcoin mining data centres.

‌CORPORATE GOVERNANCE REPORT

This Corporate Governance Report has been prepared in accordance with the Swedish Corporate Governance Code (the “Code”).

The Board of Directors is responsible for the Corporate Governance report. The Corporate Governance report for the financial year has been reviewed by the company’s auditor, as described in the “Auditor’s report on the corporate governance statement”.

CoinShares International Limited is a Jersey, public limited liability company whose shares are listed for trading on Nasdaq Stockholm. The Corporate Governance framework for CoinShares International Limited is grounded in the Company’s Articles of Association, Companies (Jersey) Law 1991, as amended, the Code, Nasdaq’s Nordic Main Market Rulebook for Issuers of Shares (the “Main Market Rulebook”), and the Company’s internal rules and guidelines. The internal rules and guidelines include primarily the Board’s rules of procedure, the CEO’s instructions, the instructions for financial reporting and internal control, and the finance manual.

NOMINATION

COMMITTEE

REMUNERATION

COMMITTEE

ANNUAL GENERAL

MEETING

BOARD OF

DIRECTORS

EXECUTIVE

COMMITTEE

EXTERNAL

AUDITOR

AUDIT & RISK

COMMITTEE

GROUP MANAGEMENT

OPERATING SEGMENTS

In addition, CoinShares International Limited has a number of policy documents and manuals, including the Code of Conduct, the Corporate Governance Policy, the Insider Policy, and the Information and Communication Policy, as well as other internal rules and recommendations that include principals and provide guidance in the company’s operations and for its employees. The above-mentioned governance documents are evaluated and adopted yearly by the Board of Directors. The requirements arising from CoinShares International Limited’s shares being listed for trading on Nasdaq Stockholm include the compulsory adoption of a corporate governance code and the company has chosen to adhere to the Code. The guidelines of the Code are available on the Swedish Corporate Governance Board’s website (www.bolagsstyrning.se). The Code is based on the “comply or explain” principal, entailing that companies that apply the Code may depart from individual rules as long as they provide an explanation for the departure. As at the date of this Corporate Governance Report, the Company has complied with the Code.

The Group’s statutory auditor is elected by the AGM to audit the Group’s annual report and accounting practices as well as the Board’s and CEO’s administration, and the company’s internal control environment.

The Nomination Committee proposes resolutions ahead of the AGM regarding issues concerning election of directors and fees and drafts a proposal for resolution that is presented to the AGM. The AGM resolves on principals for the appointment of the Nomination Committee.

The Board establishes its committees and determines which of its members are to serve on the respective committees. The Audit & Risk Committee and the Remuneration Committee report to the Board of Directors.

CORPORATE GOVERNANCE

The figure above describes how corporate governance is organized. CoinShares International Limited is a Jersey limited liability company whose shareholders ultimately decide on the company’s governance by electing the company’s board of directors at the Annual General Meeting. The Board, in turn, has continuing responsibility for ensuring that corporate governance of the company is in compliance with laws and other external and internal rules and regulations.

INTERNAL GUIDELINES

Mission and goals, Articles of Association, the Board’s Rules of Procedure, the CEO’s instructions, the financial manual, strategies and policies, and processes for internal control and governance.

EXTERNAL GOVERNANCE INSTRUMENTS

Companies (Jersey) Law 1991, the Swedish Annual Accounts Act, the Main Market Rulebook, the Code and other relevant laws.

SHAREHOLDERS


07
08	Shareholders	Shares	Ownership
	Mognetti Partners Limited	11,876,609	17.81%
	Daniel Masters	11,800,678	17.70%
	Russell Paul Newton	8,096,078	12.14%
	Alan Howard	7,913,540	11.87%
	Adam Levinson	3,896,618	5.84%
	Paul Davidson	3,140,000	4.71%
	Dwight Anderson	2,948,243	4.42%
	Vitruvius Limited	2,566,213	3.85%
	Meltem Ebru Bahar Demirors	2,374,230	3.56%
	Horseferry Trading Pte Limited	1,400,000	2.10%
	Sum 10 largest owners	56,012,209	84.00%
	Sum other	10,666,001	16.00%
	Total number of shares	66,678,210	100%
	Number of share options in issue	3,243,506	4.64%
	Total diluted share capital	69,921,716	100%
	SHARE CAPITAL AND VOTING RIGHTS

As of 31 December 2024, CoinShares International Limited had 4,396 shareholders. The ten largest shareholders as of 31 December 2024 had ownership corresponding to 87.37% of the votes and share capital. The number of unique shareholders with a holding of 5% or more in the company was five (5).

According to the Articles of Association in effect at the end of the financial year, the share capital of the company shall be no more than £99,000 divided into 200,000,000 Ordinary Shares in a single share class. The company’s registered share capital as of 31 December 2024 was £33,005.71, divided among 66,678,210 Ordinary Shares. The shares, which are denominated in British pounds (GBP), had a share price of £0.000495. Each share carries entitlement to 1 vote. Every person entitled to vote at general meetings of the shareholders may vote for the full number of shares owned and represented by him or her without restriction in voting rights.

GENERAL MEETINGS

The general meeting is the ultimate decision-making body of the company. At the general meeting, the shareholders exercise their voting rights on key issues, such as the adoption of income statements and statements of financial position, appropriation of the company’s results, election of members of the Board of Directors and auditors and remuneration to the Board of Directors and the auditors.

The annual general meeting (“AGM”) must be held within six months from the end of the financial year. In addition to the AGM, extraordinary general meetings may be convened. As permitted under article 38. Notices of the Articles of Association, general meetings are convened by publication of the notice convening the meeting on the company’s website and via a press release.

Notice of general meetings

According to the current Articles of Association, notice of general meetings shall be made:

through a relevant system, where the notice or document relates to uncertificated shares;
by giving it by electronic communication to an address for the time being notified to the Company by the Shareholder concerned for that purpose; and
by making it available on the Company’s website and publishing a press release.

Notice of the annual general meeting and extraordinary general meeting where an amendment of the articles of association will be considered shall be given no earlier than six weeks and no later than four weeks prior to the general meeting. Notice of other extraordinary general meetings shall be issued no earlier than six weeks and no later than three weeks before the general meeting.

Right to participate in a general meeting

Those shareholders who wish to participate in a general meeting must:

be recorded in the share register kept by Euroclear Sweden AB on the record date, being ten clear days prior to the general meeting; and
notify the Company of their intention to participate no later than on the date set out in the notice of the general meeting.

In addition to notifying the company, shareholders whose shares are registered under a nominee through a bank or other nominee must request that their shares be temporarily registered in their own names in the share register ten clear days prior to the general meeting in order to be entitled to participate in the general meeting. Shareholders should inform their nominees well in advance of the record date. Shareholders may attend general meetings in person or by proxy.

Shareholder initiatives

Every shareholder has the right to have a matter taken up for consideration at a general meeting. A shareholder who wishes to have a matter taken up for consideration at a general meeting must submit a written request about such to the Board of Directors. Such a request must normally be received by the Board not later than seven weeks prior to the general meeting in question.

Annual General Meeting – 2023 Financial Year

The Annual General Meeting (AGM) for the 2023 financial year was held on 31 May 2024 in the form of a virtual event without the physical presence of the shareholders or their proxies.

The AGM resolved the following:

that the income statement, balance sheet, consolidated income statement and consolidated balance sheet be adopted by the company;
to re-elect Daniel Masters, Jean-Marie Mognetti, Carsten Køppen, Johan Lundberg, Christine Rankin and Viktor Fritzén as members of the Board;
to re-elect Daniel Masters as the Board Chairman;
to re-appoint Baker Tilly Channel Islands Limited as the company’s auditors;

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that the remuneration of the auditor shall be set at the discretion of the Board; and
that the board be authorised to repurchase and transfer the Company’s own shares in accordance with the proposal presented to the AGM.

GENERAL MEETING – 2024 FINANCIAL YEAR

CoinShares International Limited’s Annual General Meeting for the 2024 financial year will be held virtually on 31 May 2025. Further information is provided at investor.coinshares.com under the section for Governance.

NOMINATION COMMITTEE

According to the Code, companies that adhere to the Code shall appoint a nomination committee. CoinShares International Limited’s Nomination Committee, which is made up of representatives of the largest shareholders, has been formed in accordance with the guidelines approved by the 2021 AGM. The Nomination Committee is tasked with submitting recommendations for the Chairman of the Board and other board members, directors’ fees and other fees for directors’ work on the Board, the election of the auditor and the auditor’s fees, and with evaluating the Board’s work. In the course of its work, the Nomination Committee applied Rule 4.1 of the Code as the Board’s diversity policy. Diversity is an important factor in the Nomination Committee’s nomination work and the Nomination Committee shall continuously strive for an even gender balance and diversity regarding the competence, experience and background of the Board’s members.

The Nomination Committee’s recommendations are reported in the AGM notice. CoinShares International Limited’s Nomination Committee shall be composed of four members, of whom three shall represent the Company’s largest shareholders, and the fourth shall be a representative of the Board. Regardless of how the Nomination Committee members are appointed, they shall safeguard the shareholders’ interests.

The members of the Nomination Committee are appointed in a procedure whereby the Chairman of the Board – as soon as possible after the end of the third quarter – contacts the three largest shareholders as at the end of August. The Chairman of the Board shall never serve as the chair of the Nomination Committee. The composition of the Nomination Committee is publicly announced through a press release as soon as the members have been appointed, but not later than six months prior to the AGM.

Based on the above, the Nomination Committee ahead of the 2024 AGM was appointed and consists of the following persons, who together represent approximately 51.73% of the number of votes and shares in the Company as per 31 August 2024:
Michael Carlton, appointed by Daniel Masters
Jean-Frédéric Mognetti, appointed by Mognetti Partners Limited
Paul Davidson, appointed by Russell Newton
Johan Lundberg, representative of the Board

BOARD COMPOSITION AND DIRECTORS’ INDEPENDENCE

According to the Articles of Association, the Board shall be composed of three to ten members. The Articles of Association state that the shareholders may, by Ordinary Resolution, appoint any person or remove any Director from office. The Board is comprised of six directors, each of whom were elected at the AGM on 31 May 2024 for the terms until the end of the 2024 AGM. Jean-Marie Mognetti, CEO, is a member of the Board. Other CoinShares executives participate at board meetings in a reporting role on specific matters. According to the Code, a majority of the directors shall be independent in relation to the Group and its management, which the company meets.

RESPONSIBILITIES AND WORK OF THE BOARD

The Board’s duties are regulated by Companies (Jersey) Law 1991, CoinShares International Limited’s Articles of Association, other laws and statutes, and the Code. In addition, the Board’s work is regulated by the Rules of Procedure adopted by the Board. The Rules of Procedure regulate, among other things, the division of duties and responsibilities between the board members, the Chairman of the Board and the CEO, and lay out routines for financial reporting by the CEO. The Board also adopts instructions for the Board’s committees. The Board’s duties include adoption of strategies, business plans, budgets and forecasts, interim reports, the year-end book-closing, and policies and guidelines. The Board is also responsible for monitoring the company’s financial performance, ensuring the quality of financial reporting and internal controls, and evaluating the business against the objectives and guidelines established by the Board. Finally the Board decides on substantial investments and changes in the Group’s organisation and operations. The Chairman of the Board and CEO shall monitor the company’s performance, and conduct preparatory work for and lead board meetings. The Chairman of the Board is also responsible for ensuring that the board members evaluate their work every year and that they continuously receive the information required for them to perform their work effectively. The Chairman of the Board represents CoinShares vis-à-vis its shareholders.

During the year, the Board held 5 meetings. The Board’s work during the year was focused particularly on the company’s strategy, including the integration of acquired operations, positioning, financing, culture, and the company’s development and expansion.

Committees

The Board of CoinShares International Limited has established two committees – an audit & risk committee and a remuneration committee.

Audit & Risk Committee

The Audit & Risk Committee was formally established on 29 November 2021. The Audit & Risk Committee is tasked with providing a special forum for the work with financial reporting, internal control, risk management and auditing, and advises the Board of Directors in these areas. The members of the Audit & Risk Committee are Carsten Køppen Viktor Fritzén and Christine Rankin, who is also the committee chair. The main duties of the Audit & Risk Committee are to monitor the Group’s financial reporting and to oversee the effectiveness of the company’s internal controls and risk management. In addition, the Audit & Risk Committee is tasked with staying informed about the audit of the annual report and consolidated accounts, reviewing and overseeing the auditor’s impartiality and independence, and in this context paying particular attention to whether the auditor provides other services to the Group than auditing services.

The Audit & Risk Committee maintains contact with the Group’s auditor in order to establish an ongoing exchange of information and understanding between the Board and the auditor on auditing issues.

The Audit & Risk Committee held 7 meetings in 2024.

Remuneration Committee

The Remuneration Committee was formally established on 29 November 2021. The members of the Remuneration Committee are Carsten Køppen, Johan Lundberg and Daniel Masters, who is also the committee chair. The Remuneration Committee has an advisory and a drafting function. Its main duties are to conduct preparatory work for the Board’s decisions on matters concerning remuneration principles, remuneration and other terms of employment for members of the Executive Management Committee, monitoring and evaluating application of the guidelines for remuneration of senior executives approved by the AGM as well as applicable remuneration structures and remuneration levels in CoinShares.

The Remuneration Committee held 2 meetings in 2024.

Evaluation of the Board’s work

The Board’s work is evaluated yearly through a systematic, structured process that aims among other things to produce constructive documentation for improvements in the Board’s own work. The evaluation is conducted both individually and through discussions at board meetings. The evaluation aims to give the Chairman of the Board information on how the board members perceive the Board’s effectiveness and collective competence as well as on whether there are any needs for changes on the Board. Chairman of the Board informs the Nomination Committee about the results of the evaluations.

Directors’ fees

Total remuneration paid to the directors for 2024 was £325,000, including remuneration for committee work. Please note this does not include remuneration paid to the CEO. Details on CEO remuneration can be found in the 2024 Remuneration Report.

INTERNAL CONTROL AND RISK MANAGEMENT

Due to the nature of the industry within which the Group operates, coupled with the nature of the services and products provided, a robust control environment is paramount in order to protect the Group’s stakeholders, ensure compliance with regulatory requirements of the Group, and allow for accurate and timely dissemination of information throughout the Group.

The control environment is focused on the areas described below.

Risk Management and Counterparty Monitoring

The Group has a variety of systems and controls in place that allow for the ongoing monitoring of all of its digital asset holdings and positions with each of its counterparties. Internal reports are generated automatically every 10 minutes (increased to every minute during periods of significant volatility) and provided to the relevant members of CoinShares Asset Management and CoinShares Capital Markets responsible for hedging and trading activities of the Group.

This is further enhanced by a daily reconciliation and examination of the composition of digital assets to ensure the activities of the Group remain in accordance with the terms of the Collateral Management Agreement between CoinShares Capital Markets (Jersey) Limited and XBT Provider AB (publ).

All counterparties with which the Group interacts for the purpose of either digital assets storage or trading are subject to robust due diligence procedures and are integrated fully with the Group’s internal systems prior to engaging in any kind of active relationship.

The counterparty risk of the Group is further mitigated by the fact that the majority of the Group’s physical asset holdings are in custody with Komainu Jersey and Zodia Custody, regulated custodians and depositaries specialising in digital assets.

Cyber-security

Cyber-security remains a critical focus for the Group. Significant investment in and ongoing improvement of the Group’s security posture is essential to align the infrastructure of the Group with its growth. From a completely new physical networking layer to the optimised, secure cloud environment, these improvements have been validated by the Group’s external information security audits and accreditations.

Maintaining the integrity of its technical architecture is an ongoing priority and focus of the CS Group’s executive leadership tests, and, in this regard, the CS Group ensures the undertaking of regular external reviews and penetration tests whilst also ensuring that its infrastructure is monitored in real- time by state-of-the-art security monitoring systems. Further, the CS Group’s cloud-based network is segregated and tied back to physical premises and remote workstations using best-in-class encryption technology. All data stored on CS Group servers and file stores are fully encrypted at rest and in transit.

The Group’s latest annual independent cyber-security review described the Group’s security profile as “very strong” and “highly secure”. At the same time, the Group has maintained ISO/IEC 270001 certification since 2019 (the auditable, international standard for Cyber Security), evidencing adherence to a “best-practice” approach to managing information security by addressing people and processes as well as technology.

Ah-hoc security tests and attack simulations are regularly undertaken to allow the Group to ensure buy- in and understanding from all employees. The Group’s endpoint, mobile and perimeter protections are monitored continuously to adapt to emerging threats and ensure that the Group remains protected in the ever-changing cyber-security landscape. Furthermore, the Group’s cyber-security controls are routinely tested as part of the Group’s Compliance Monitoring Plan.

Regulatory and Compliance

The CoinShares Group operates the Three Lines of Defence model, which is considered to be industry best practice and is composed as follows:

The First Line of Defence – the client facing operations teams in each of the Group’s jurisdictions; The client-facing operations teams are responsible for maintaining a strict control environment over day-to-day operational matters. The first line has a comprehensive control framework, managed and maintained by them and monitored by the Compliance Function; the framework spans both organisation wide controls and department specific controls.

The Second Line of Defence – the Group’s Compliance and Risk team;

The Group’s Compliance Team has a number of key responsibilities, including but not limited to:

the anti-money laundering, countering of terrorism financing and proliferation financing control framework and associated staff training;
regular testing of the Group’s control framework;
liaising with the Group’s various external regulatory bodies;
undertaking the role of Money Laundering Reporting Officer, Money Laundering Compliance Officer and Compliance Officer as required; and
regular reporting/communication of Compliance and risk matters to the monthly Risk & Compliance Committee and to the relevant Boards.

The Group also benefits from a network of external advisors relied upon as required for guidance on a range of specialized topics.

The Third Line of Defence – external financial audit and other specialist audit work;

The Group relies upon both the annual financial audit process in addition to more focused specialised external audit work, undertaken on particular parts of the business, for example, the work undertaken previously by Armanino and now by The Network Firm.

Information Dissemination and Transparency

Due to various jurisdictions within which the Group operates, and the variety of activities undertaken across the Group it is essential that information is disseminated in a timely and consistent manner. To facilitate this, various committees are in place with meetings held on a regular basis to encourage the information generated by the Group’s control environment to be disseminated accordingly. Each committee has documented terms of reference and all relevant information from those committees is regularly reported to the appropriate boards.

The dissemination of information is not only a focus of the Group internally, but also externally to the Group’s stakeholders, be they regulators, auditors, existing or prospective clients. As such, an external assurance report is issued on a daily basis which evidences the quantum of hedging assets (held in accordance with the terms of the CMA) being in excess of the liability arising from the issuance of XBT products. The report is prepared by the Network Firm, a third party service provider. Any of the Group’s stakeholders can download the report from https://etp.coinshares.com/proof-of-reserves.

The work performed by The Network Firm is independent from the Group’s internally generated reports on digital asset holdings, thus providing an additional level of comfort and accompanying third party opinion.

CEO AND SENIOR EXECUTIVES

The CEO is responsible for the day-to-day administration of the Group in accordance with applicable laws and regulations, and the instructions and strategies established by the Board of Directors. The CEO ensures that the Board receives the information required for the Board to be able to make well-grounded decisions, and monitors compliance with the goals, policies and strategy plans for CoinShares that are set by the Board of Directors. The CEO is also responsible for ensuring that the Board is provided with satisfactory information about the Group’s development between regular board meetings. The CEO leads the work of the Executive Management Committee, which is responsible for the overarching business development. In addition to the CEO, the Executive Management Committee included five senior executives as of 31 December 2024: the Chief Financial Officer, Head of Asset Management, Head of Quantitative Research & Development, Head of Marketing & Communications and Head of Hedge Fund Solutions.

Remuneration of the CEO and senior executives

Remuneration of the CEO and other senior executives may consist of a fixed cash salary, discretionary bonus, other customary benefits and pension. The combined yearly cash remuneration shall be in line with the going rate in the market and geographic area in which the executive is stationed, and shall be commensurate with the individual’s qualifications and experience. By other senior executives is meant the five persons who, together with the CEO, make up the Executive Management Committee. The guidelines for remuneration of the senior executives include, among other things, principles for the relationship between fixed salary, pension benefits, and limitations regarding severance pay and fixed salary during notice periods. Individual remuneration of the CEO and the individual remuneration of other senior executives are approved by the Board of Directors based on recommendations made by the Remuneration Committee.

AUDITOR

At the Annual General Meeting on 31 May 2024 resolved to elect the chartered accounting firm Baker Tilly Channel Islands Limited as auditor of the company for a term until the end of the 2024 AGM. Authorised Public Accountant Hafeez Azeez was appointed auditor-in-charge. Hafeez Azeez is a member of the Association of Chartered Certified Accountants.

EXTERNAL AUDIT

The external audit of the accounts of CoinShares International Limited and all subsidiaries, including the Board of Directors’ and Group Management’s administration, is performed in accordance with International Standards on Auditing. The external auditor will attend all meetings of the Audit Committee and at least one board meeting each year, at which the auditors report on their observations from the audit and their opinion on internal control.

BOARD OF DIRECTORS

Daniel Masters

Assignments and year elected

Born 1963, Chairman of the Board since 2008. Chair of the Remuneration Committee.

Education, professional experience and previous assignments

Daniel holds a Bachelor of Science (Honours) in Physics from Exeter University and a Master’s degree in Management Science and Operational Research from Imperial College, London.

Daniel has more than 30 years of experience in energy trading. He was, among other things, the Head of Global Energy Trading for Morgan Guaranty Trust Company (MGT), oversaw several of the trading and risk management functions at the Energy Division of Salomon, Inc., was involved in the establishment of the natural gas and electricity markets in the UK, completed some of the first forward contracts for electricity and was one of the first and most active participants in the market for Contracts for Difference in Europe.

Other current assignments

Director and Shareholder of Crypto Composite Limited; Director and Shareholder of Satoshipay Limited; Director and Shareholder of Invoccasion Limited; Council Member of Tezos Foundation.

Non-Executive Director’s fee (yearly)

Salary - £125,000 Bonus - £Nil

Benefits in kind - £5,748

Fee for committee work

Included within Director’s fee.

Independent in relation to the company and Group management

No.

Independent in relation to major shareholders

No.

Own and related parties’ shareholdings as per 31 December 2024

11,800,678 ordinary shares. Attendance at board meetings 5 of 5 possible.

Attendance at Remuneration Committee meetings

2 of 2 possible.

Jean-Marie Mognetti

COINSHARES

Assignments and year elected

Born in 1984, Board member since 2014. Member of the Executive Management Committee..

Education, professional experience and previous assignments

Jean-Marie holds a Master’s degree in Mathematical Trading and Finance from Sir John Cass Business School.

Jean-Marie is an experienced commodities trader with a background and expertise in quantitative analysis, risk management and alpha-generation through macro commodity-oriented programs, including cryptocurrencies. Prior to joining CoinShares, Jean-Marie was a quantitative strategist with Hermès Commodities Fund Managers.

Other current assignments

Director and Shareholder of Mognetti Partners Limited; Director of Tactiques D’avant-Garde (Jersey) Limited.

Fee for committee work

Not applicable.

Independent in relation to the company and Group management

No.

Independent in relation to major shareholders

No.

Own and related parties’ shareholdings as per 31 December 2024

11,876,609 ordinary shares and 618,356 share options.

Attendance at board meetings

5 of 5 possible.

Carsten Køppen

Assignments and year elected

Born in 1964, non-executive Board member since 2020. Member of the Remuneration Committee. Member of the Audit and Risk Committee.

Education, professional experience and previous assignments

Carsten holds a Diploma in Banking from the Danish School of Banking.

Carsten has 40 years of experience in financial services, including stock exchange equity trading, investment advisory, capital market debt and fixed income, alternative asset management and asset servicing. He is a specialist in corporate governance and best practices within the alternative investment fund industry, and is also, among other things, independent, regulated non-executive director and Member of the Board to various alternative investment structures and managers.

Other current assignments

Director of Triton Managers Limited; Director of Triton Managers II Limited; Director of Triton Managers III Limited; Director of Triton Managers IV Limited; Director of Triton Managers V Limited; Director of Triton Smaller Mid Cap General Partner Limited; Director of Triton Debt Opportunities Managers Limited; Director of Triton Debt Opportunities Managers II Limited; Director of Triton Managed Account General Partner Limited; Director of Octopus Alternative Investment Fund Management Limited.

Director’s fee (yearly)

£50,000

Fee for committee work

Included within Director’s fee.

Independent in relation to the company and Group management

Carsten held a non-executive directorship position on the Board of CoinShares (Jersey) Limited, a Group Company, until the end of November 2021.

Independent in relation to major shareholders

Yes.

Own and related parties’ shareholdings as per 31 December 2024

14,400 ordinary shares. Attendance at board meetings 5 of 5 possible.

Attendance at Audit Committee meetings

7 of 7 possible.

Attendance at Remuneration Committee meetings

2 of 2 possible.

Johan Lundberg

Assignments and year elected

Born in 1977, non-executive Board member since 2020. Member of the Nomination Committee. Member of the Remuneration Committee.

Education, professional experience and previous assignments

Johan holds an MBA in Finance from Stockholm School of Economics; MBA in International Strategy from Stockholm University.

Johan is a founding partner of NFT Ventures, an early- and growth-stage fund founded in 2014 to capture the opportunity in transformation of banking and financial services.

Other current assignments

Chairman of Betsson AB, Alfa Kraft Fonder AB, Barcelona Opportunity AB (publ), Barcelona Development Corporation AB and NFT Growth 2 AB. Director of the board and CEO of NFT Growth Partners AB (publ), Investment AB Stentulpanen and AB Stentulpanen Försäkringar. CEO of Stenbuketten Invest AB and Investment AB Vildtulpanen. Director of Svolder AB, Loomis AB, Wakakuu AB, Contemporary Wines Sweden AB (publ), Pensa Sverige AB, MR Cake AB, MR Cake Göteborg AB, MR Cake retail AB, MR Cake Holding AB, Stentulpanen Fastigheter Smedby AB, Fastighets AB Stentulpanen Stockholm, Stentulpanen Fastigheter i Kalmar & Öland AB, Fastighets AB Stentulpanen, Kapitalförvaltnings AB Stentulpanen, Nordic Collection AB, NFT Ventures AB, NFT Ventures 1 AB, NFT Ventures 2 AB, NFT Ventures CV 1 AB, NFT Ventures Invest AB, Purslane Ventures AB, Ölands Bank AB, Roy Fares AB and SoliFast Holding AB and director of Global Fintech Industries AB. Director’s fee (yearly)

£50,000

Fee for committee work

Included within Director’s fee.

Independent in relation to the company and Group management

Yes.

Independent in relation to major shareholders

Yes.

Own and related parties’ shareholdings as per 31 December 2024

2,500 ordinary shares. Attendance at board meetings 5 of 5 possible.

Attendance at Remuneration Committee meetings

2 of 2 possible.

Christine Rankin Assignments and year elected

Born in 1964, non-executive Board member since 2021. Chair of the Audit and Risk Committee.

Education, professional experience and previous assignments

Christine holds a Bachelor in Business Administration and Economics from Stockholm University. Christine is a former Partner at PWC and has held positions of trust at several organisations including Veoneer Inc, Spotify, NASDAQ and Cherry AB.

Other current assignments

Director of the board and audit committee chair of Bone Support Holding AB, 4C Group AB, Orexo AB, and Starbreeze AB (publ).

Director’s fee (yearly)

£50,000

Fee for committee work

Included within Director’s fee.

Independent in relation to the company and Group management

Yes.

Independent in relation to major shareholders

Yes.

Own and related parties’ shareholdings as per 31 December 2024

N/A.

Attendance at board meetings

5 of 5 possible.

Attendance at Audit Committee meetings

7 of 7 possible.

Viktor Fritzén

Assignments and year elected

Born in 1985, non-executive Board member since 2021. Member of the Audit and Risk Committee.

Education, professional experience and previous assignments

Viktor holds a Master in Finance from the Stockholm School of Economics.

Viktor previously held the positions of CFO at LeoVegas AB, Global Investment Research Analyst and Corporate Finance Analyst at Goldman Sachs and GP Bullhound respectively as well as serving on the board of directors at Avanza Holding AB, Försäkringssktiebolaget Avanza Pension, Readly International AB and AppJobs Sweden AB

Other current assignments

Chair of the board of StickerApp Holding AB. Director of the board of Beyond Zebra AB, Cithara BidCo, Stabelo Group AB, Cithara HoldCo AB and Safello AB.

Director’s fee (yearly)

£50,000

Fee for committee work

Included within Director’s fee.

Independent in relation to the company and Group management

Yes.

Independent in relation to major shareholders

Yes.

Own and related parties’ shareholdings as per 31 December 2024

40,100 ordinary shares. Attendance at board meetings 5 of 5 possible.

Attendance at Audit Committee meetings

7 of 7 possible.

GROUP MANAGEMENT

Jean-Marie Mognetti

Group Chief Executive Officer

Education, professional experience and previous assignments

As disclosed above

Other current assignments

As disclosed above

Own and related parties’ shareholdings as per 31 December 2023

As disclosed above

Attendance at Executive Management Committee meetings

6 of 6 possible.

Richard Nash

Chief Financial Officer

Education, professional experience and previous assignments

Richard holds a Master’s degree in Sinology from School of Oriental and African Studies, University of London.

Richard has 14 years of experience in chartered accounting. Richard joined CoinShares from Cairn Financial Advisers where he acted as Nominated Adviser to a number of listed companies, holding the status of Qualified Executive (as granted by the London Stock Exchange). Richard was formerly part of the RSM UK Capital Markets Team, where he acted as reporting accountant to a number of listings.

Other current assignments

N/A.

Own and related parties’ shareholdings as per 31 December 2024

900 ordinary shares and 204,423 share options.

Attendance at Executive Management Committee meetings

6 of 6 possible.

Frank Spiteri

Head of Asset Management

Education, professional experience and previous assignments

Frank has over 10 years of experience as an ETP specialist, joining CoinShares after previously working as the former Head of Distribution and Capital Markets at WisdomTree. Prior to specializing in ETPs, he spent 11 years working as a trader with KBC Financial Products.

Other current assignments

N/A

Own and related parties’ shareholdings as per 31 December 2024

408,058 ordinary shares and 1,119,995 share options. Attendance at Executive Management Committee meetings 6 of 6 possible.

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Pierre Porthaux

Head of Quantitative Research & Development

Education, professional experience and previous assignments

Pierre has close to 20 years’ experience in finance in both traditional markets and cryptocurrencies. Prior to CoinShares, Pierre co-founded Blockchain Solutions, a technology and strategy consulting company, and Emergence Labs, specialized in Bitcoin trading technology, both located in Paris. Previously, Pierre was a trader undertaking statistical and index arbitrage strategies for banks and hedge funds such as Nomura, Millennium Partners, Dresdner Kleinwort and Natixis.

Other current assignments

N/A

Own and related parties’ shareholdings as per 31 December 2024

25,490 ordinary shares and 144,540 share options. Attendance at Executive Management Committee meetings 5 of 6 possible.

Benoît Pellevoizin

Head of Marketing & Communications

Education, professional experience and previous assignments

Benoît graduated from the Celsa Sorbonne Université (Grande Ecole of Communications & Journalism) and the Hasso Plattner Institute School of Design Thinking. Benoît has over 15 years of experience in developing marketing, communications, advertising and branding. He joined CoinShares from the leading crypto hardware firm Ledger. Prior to that he has held positions involving strategy, branding and innovation with Ogilvy Consulting, SID LEE, M&C Saatchi, Fred & Farid and Digitas.

Other current assignments

N/A

Own and related parties’ shareholdings as per 31 December 2024

40,000 share options.

Attendance at Executive Management Committee meetings

5 of 6 possible.

Lewis Fellas

Head of Hedge Fund Solutions

Education, professional experience and previous assignments

Lewis holds Bachelor and Master’s degrees in Chemistry from the University of Reading and an MBA from Cambridge Judge Business School. Lewis is a veteran asset manager with over 23 years of experience gained at JPMorgan London, hedge funds in Hong Kong and the Harvard Endowment in Boston. Lewis has 7 years experience in Crypto having founded one of the earliest Crypto funds, Bletchley Park, in 2017.

Other current assignments

Director of Spring IM Limited.

Own and related parties’ shareholdings as per 31 December 2024

300 ordinary shares.

Attendance at Executive Management Committee meetings

6 of 6 possible.

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SHARES, SHAREHOLDERS AND SHARE CAPITAL

GENERAL INFORMATION

CoinShares International Limited was listed on Nasdaq Stockholm in December 2022. According to the company’s Articles of Association, the share capital of the company shall be no more than

£99,000 divided into 200,000,000 Ordinary Shares in a single share class. The company’s registered share capital as of 31 December 2024 was £33,005.71, divided among 66,678,210 Ordinary Shares. The shares, which are denominated in British pounds (GBP), had a share price of £0.000495. The company’s shares have been issued in accordance with Jersey law. All issued shares are fully paid for and freely transferable. The company’s shares are listed on the regulated multilateral trading facility, Nasdaq Stockholm, and the ISIN code for CoinShares International Limited’s shares is JE00BLD8Y945. The company’s shares are not the subject of any offer that has been made as a result of a mandatory bid, redemption right or redemption obligation. Nor has any public takeover offer been made for the shares during the current or preceding financial years.

Certain rights associate with the shares

The company’s shares are of the same class. The rights associated with shares issued by the company, including those pursuant to the Articles of Association, may only be amended in accordance with the procedures set out in Companies (Jersey) Law 1991.

Voting rights

Each share entitles the holder to vote at general meetings, and each shareholder is entitled to a number of votes corresponding to the shareholder’s total holding of shares in the company.

Preferential rights to new shares

In accordance with Article 3 of the Articles of Association (the “Articles”), the company shall not allot and issue ordinary shares, or rights to subscribe for, or to convert securities into, ordinary shares (‘Equity Securities”), to any person on any terms unless it has made an offer to each Shareholder on the same or more favourable terms (the “Preferential Rights”). These Preferential Rights shall not apply to:

any ordinary shares issued pursuant to the exercise of warrants;
in one or more tranches of ordinary shares as does not in the aggregate exceed ten percent (10%) of the total number of ordinary shares in issue at 9am on 1 January of such year; and
any Equity Securities allotted and issued by the Directors in the three years following adoption of the Articles pursuant to any employee incentive or bonus plan or scheme. Such Equity Securities not to exceed fifteen percent (15%) of the total number of ordinary shares in issue at the date of the adoption of the Articles.

DIVIDEND AND DIVIDEND POLICY

General

All shares carry equal entitlement to a share in the company’s profits and to the company’s assets and any surpluses in the event of liquidation. Resolutions regarding dividends in limited liability companies are made by a general meeting of shareholders or by the Directors if justified by the profits of the Company.

Entitlement to dividends accrues to those who, on the record date resolved by a general meeting of shareholders or the Directors, are registered in the shareholder register maintained by Euroclear Sweden as holders of shares. Dividends are normally paid to the shareholders as a cash amount per share through Euroclear Sweden, although they may also be paid in a form other than cash (in- kind dividend). If a shareholder cannot be reached through Euroclear Sweden, the shareholder will continue to have a claim against the company for the dividend amount for a period that is limited by rules concerning a ten-year statute of limitation. After expiration of this limitation period, the dividend amount accrues to the company. There are no restrictions on dividend rights in respect of shareholders who reside outside Sweden.

Dividend policy

The dividend policy stipulates that the annual dividend payment will be between 20% and 40% of the Group’s net profit excluding any special dividend payments made during the financial year.

The annual dividend payment will be made payable in SEK in four quarterly instalments via the Euroclear Sweden settlement system, subject to an assessment by the Board of the financial health and cash requirements of the Group prior to each payment being made, in accordance with Companies (Jersey) Law 1991.

CENTRAL SECURITIES DEPOSITORY

CoinShares International Limited’s shares are registered in an electronic VPC register in accordance with the Central Securities Depositories and Swedish Financial Instruments Accounts Act (Lagen (1998:1479) om värdepapperscentraler och kontoföring av finansiella instrument). No share certificates have been issued for the company’s shares registered in the VPC register. The account operator is Euroclear Sweden.

CONVERTIBLES, WARRANTS, AUTHORISATIONS TO ISSUE SECURITIES, ETC.

Incentive programs

In accordance with the Articles of Association, the Board of Directors is authorised, in three years from the date of adoption of the Articles of Association (20 June 2022), to issue share options that do not, in aggregate, exceed 15% of the total number of outstanding ordinary shares. The employee incentive program (“EIP”) is governed by general terms and conditions and individual share option agreements with the holders of share options.

The aim of the EIP is to create conditions to retain and increase motivation of senior executives, other employees and other key persons in the company and Group. The Board of Directors believes that it is in the interests of all shareholders that senior executives, other employees and key persons have a long-term interest in good growth in the value of the company’s shares. A long-term owner engagement is expected to stimulate greater interest in the business and its earnings performance overall and enhance motivation among the participants and aims to achieve a greater foundation for shared interests between the program’s participants and the company’s shareholders.

Share Options issued under the EIP - November 2020

On 25 October 2019 the Board of CoinShares (Holdings) Limited, a Group Company, resolved on an incentive program that was approved by its shareholders on 29 October 2019. During March 2020, warrants were issued based on the terms for the incentive program for employees. The Share Options issued under the incentive program for employees in CoinShares (Holdings) Limited were transferred to CoinShares International Limited on 24 November 2020 on the same terms as Share Options granted at CoinShares (Holdings) Limited level. The number of share options issued were adjusted in connection with the transfer in order to ensure the recipient received share options corresponding to the number which were initially issued. The strike price was adjusted accordingly. Following the transfer of the share options from CoinShares (Holdings) Limited to CoinShares International Limited, no options exist in CoinShares (Holdings) Limited.

A total of 2,955,920 share options were issued and held by key employees in Jersey, the UK and the US. Of these share options, 1,011,320 were issued with 13 March 2023 as the vesting date.

The remaining 1,944,600 share options, held by the Group’s CRO Frank Spiteri, are subject to certain vesting criteria that need to be fulfilled; (i) double the Group’s AUM, (ii) double the customer count and (iii) drive team performance (determined by the Board). The vesting terms are outlined in a separate share option agreement between the company and Frank Spiteri.

The following terms apply to all 2,995,920 share options:

each share option gives the share option holder the right to subscribe for one ordinary share in the company;
the share options were issued free of charge; and
the subscription price (strike price) for each ordinary share amounts to £1.43, equivalent to the fair market value of one ordinary share at issuance (adjusted accordingly following the transfer to the company) and as determined by a third party valuation specialist.

Share Options issued under the EIP – March 2021

On 22 February 2021, the Board resolved to grant key employees a total of 183,489 share options. The following terms apply to all 183,489 share options:
the share options would vest in eight equal tranches over the 24 months from the date of issue, being 11 March 2021;
each share option gives the share option holder the right to subscribe for one ordinary share in the company;
the share options were issued free of charge; and
the subscription price (strike price) for each ordinary share amounts to SEK 44.9, equivalent to the subscription price in Prospectus dated 22 February 2021.

Share Options issued under the EIP – April 2021

On 26 March 2021, the Board resolved to grant key employees a total of 373,944 share options. The following terms apply to all 373,944 share options:
vesting date of 19 April 2024;
each share option gives the share option holder the right to subscribe for one ordinary share in the company;
the share options were issued free of charge; and
the subscription price (strike price) for each ordinary share amounts to SEK 94.4.

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Share Options issued under the EIP – March 2022

On 21 January 2022, the Board resolved to grant key employees a total of 670,002 share options. The following terms apply to all 670,002 share options:
vesting date of 18 March 2025;
each share option gives the share option holder the right to subscribe for one ordinary share in the company;
the share options were issued free of charge; and
the subscription price (strike price) for each ordinary share amounts to SEK 82.3.

Share Options issued under the EIP – March 2023

On 20 February 2023, the Board resolved to grant key employees a total of 448,000 share options. The following terms apply to all 448,000 share options:
vesting date of 20 March 2026;
each share option gives the share option holder the right to subscribe for one ordinary share in the company;
the share options were issued free of charge; and
the subscription price (strike price) for each ordinary share amounts to SEK 31.0.

Share Options issued under the EIP – March 2024

On 19 March 2024, the Board resolved to grant key employees a total of 115,000 share options. The following terms apply to all 115,000 share options:
vesting date of 20 March 2027;
each share option gives the share option holder the right to subscribe for one ordinary share in the company;
the share options were issued free of charge; and
the subscription price (strike price) for each ordinary share amounts to SEK 50.4.

Share Options issued under the EIP – March 2025

On 24 March 2025, the Board resolved to grant key employees a total of 345,038 share options. The following terms apply to all 345,038 share options:
vesting date of 24 March 2028;
each share option gives the share option holder the right to subscribe for one ordinary share in the company;
the share options were issued free of charge; and
the subscription price (strike price) for each ordinary share amounts to SEK 72.8.

As of 20 March 2025, 1,614,998 share options had either lapsed, been exercised or cancelled.

If all 3,516,795 outstanding share options in the company were to be exercised for subscription of ordinary shares, the maximum dilution amounts to approximately 5.01 percent of the number of outstanding ordinary shares as at 20 March 2025.

GROWTH IN SHARE CAPITAL

Since the company’s shares were listed for trading on Nasdaq First North Growth Market on 11 March 2021, the company has decided on new share issues on two occasions and cancelled own shares on two occasions.

The below is a table of the number of shares and registered share capital shows registrations related to the historical development of these new share issues and other events pertaining to the company’s share capital.

Number of Shares


Registration date	Event	Change	Total
11 March 2021	IPO	-	66,551,863
6 July 2021	Consideration for acquisition	1,298,322	67,850,185
16 December 2021	Consideration for acquisition	363,636	68,213,821
11 January 2022	Cancellation of shares	(78,396)	68,135,425
8 August 2022	Cancellation of shares	(121,654)	68,013,771
19 January 2024	Cancellation of shares	(358,310)	67,655,461
16 August 2024	New Issuance for Options Exercise	25,490	67,680,951
3 September 2024	Cancellation of shares	(1,114,321)	66,566,630
11 September 2024	New Issuance for Options Exercise	27,860	66,594,490
16 September 2024	New Issuance for Options Exercise	55,720	66,650,210
21 November 2024	New Issuance for Options Exercise	28,000	66,678,210
31 December 2024			66,678,210

OWNERSHIP STRUCTURE

The table below shows CoinShares International Limited’s largest shareholders as per 31 December 2024. The company had 4,396 shareholders on 31 December 2024.


Shareholders	Shares	Share of Ownership
Mognetti Partners Limited	11,876,609	17.81%
Daniel Masters	11,800,678	17.70%
Russell Newton	8,096,078	12.14%
Alan Howard	7,913,540	11.87%
Adam Levinson	3,896,618	5.84%
Paul Davidson	3,140,000	4.71%
Dwight Anderson	2,948,243	4.42%
Vitruvius Limited	2,566,213	3.85%
Meltem Demirors	2,374,230	3.56%
Horseferry Trading Ptd Limited	1,400,000	2.10%
Total, 10 largest shareholders	56,012,209	84.00%
Other existing shareholders	10,666,001	16.00%
Total	66,678,210	100%

Shareholder agreements

To the best of the knowledge of CoinShares International Limited’s board of directors, there are no shareholder agreements or other agreements between the company’s shareholders that are intended to influence the company. Nor is the company’s board aware of any agreements or similar undertakings that could lead to a change in control over the company.

SHARE PRICE DEVELOPMENT

The table below shows movements in the company’s share price during the year. CoinShares International Limited’s shares are traded under the ticker code “CS”. The initial listing was on Nasdaq First North Growth Market in March 2021 and the Company’s shares were listed for trading on Nasdaq Stockholm on 19 December 2022. The initial listing price was SEK 44.9. The lowest price paid for the shares in 2024 was SEK 34.55 and the highest price paid during the year was SEK 94.4. The price of the shares was SEK 83 at year-end.

Share Price (SEK) - 2024

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‌SUSTAINABILITY REPORT

INTRODUCTION

CoinShares’ Sustainability Report aims to be transparent and pertinent to ensure that stakeholders can easily learn about our sustainability efforts and gain an understanding of our performance and progress over time in relation to Environmental, Social and Governance (“ESG”) initiatives. This report presents the events and outcomes for 2024.

The disclosures are structured according to our key sustainability topics. The report has been written with reference to the Swedish Annual Accounts Act (1995:1554), and is presented in four sections, as follows:

Strategy & Current Position
Sustainability
Environmental Initiatives
Social Initiatives

The governance of the CoinShares (i.e. the “Group”), which forms a key part of the ESG initiatives is presented separately within the Corporate Governance section of the Annual Report.

STRATEGY & CURRENT POSITION

Strategy

In 2024 we built upon our initial ESG strategy and refined certain elements so that ESG is considered a core pillar of our business initiatives and company culture. We monitored our ESG framework that sets clear objectives and can be transparently measured to demonstrate our commitment to ESG. Our ESG Strategy is supported by a company-wide and Board approved ESG Policy, which requires mandatory acknowledgement by all of our CoinShares employees.

The three pillars of our strategy are:
- Sustainability: adopting climate change friendly standards and working towards reducing our CO2 footprint.
- Education: market leading information provider in the crypto ecosystem from novices to industry experts.
- Investing in the future: promoting and developing next generation talent from universities and nurturing existing personnel within the Group.
  
  We aim to consider each of these in all our ESG initiatives, and also to promote them within the company-wide culture of the Group.
  
  These core pillars are crucial to our ability to be responsible and effective stewards of the digital asset ecosystem as cryptocurrencies are inherently political, social, and economic in nature. As a company we have always therefore been interested and invested in the development of initiatives in relation to digital assets and digital asset investing, particularly through the output of our Research team. Finally, these pillars ensure that we are rightfully and actively considering our external impacts on the wider community and market outside of the digital assets’ environment.
  
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  Current Position
  
  For the nascent cryptocurrency industry, CoinShares is considered in its formative stages of its ESG journey. We have therefore taken steps in 2024 (and the three consecutive prior years) to peer assess our ESG credentials against other leading financial institutions. It is important to quantify where we are placed in our ESG journey, allowing us to quantify the progress made as we move forward and the industry around us evolves.
  
  CoinShares completed the S&P Global Corporate Sustainability Assessment (“CSA”) that tested a wide range of ESG criteria, benchmarked scoring against some 600+ financial institutions such as banks and financial technology (FinTech) participants. The submission process provided useful insights into specific improvement areas for the Group in the future. In 2024, CoinShares scored a higher ESG score in comparison to 2023 displaying our commitment to sustainability initiatives. Our 2024 ESG score is comparable to industry peers whereby we saw score improvements in the Environment, Corporate Governance and Information Security topics. However, there are further efforts and investments required to support our ongoing ESG efforts. For instance, in 2024 the Group has engaged with a sustainability solution to build a complete carbon footprint picture of our main office locations and to recommend any new ESG initiatives, such as emission reduction plans. A 2024 carbon footprint report has been produced and verified by our third-party sustainability partner. The report highlights the scale of our Scope 1-3 emissions measured in tonnes of carbon dioxide equivalent (“tCO2e”) as well as the most emissions intensive activities conducted by CoinShares. CoinShares does not directly engage in Bitcoin mining and hence is not directly engaged (i.e. Scope 1-2 emissions) in its significant energy usage. As the ESG initiatives are implemented, CoinShares management is able to define key performance indicators for the Group to measure their growth and improvement in the ESG space.
  
  We have annually refreshed the ESG Materiality Assessment to identify focal areas that are key to our long-term ESG Strategy. The results of this assessment help to organise our sustainability initiatives and to prioritise the ESG matters of the highest importance. Priority issues were identified and mapped on an ESG Materiality Matrix based on the impacts to both internal and external stakeholders. The below five steps were taken to perform the ESG Materiality Assessment:
  1. Identification – we reviewed existing ESG standards, regulations and our peers to improve our knowledge of the current ESG landscape. We also utilised a ratings agency (S&P) and sustainability partner (Futuretracker) to help identify topical and priority ESG areas.
  2. Classification – we defined a list of material ESG topics specific to our sector and CoinShares and classified them as Environmental, Social or Governance topics.
  3. Impact Assessment – we delved deeper into each of the material ESG topics to assess the impact on both our main internal stakeholders (e.g. employees) and external stakeholders (e.g. crypto market participants, investors, local community).
  4. Feedback collation – we engaged the Audit and Risk Committee to provide feedback on the material ESG topics relevant to the long-term viability of CoinShares. Once ratified with this committee, the ESG Materiality Matrix was mapped.
  5. Reporting – the ESG Materiality Matrix is reported publicly as part of the Annual Report.
    
    The ESG Materiality Matrix is prepared in accordance with the EU’s Corporate Sustainability Reporting Directive (“CSRD”) and the matrix is displayed below:
    
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    2024 ESG Materiality Matrix
SUSTAINABILITY

Sustainability & Output of Research Team

The digital asset industry is at the forefront of the technology to ensure a more efficient energy usage environment for financial services in the future, and we seek an active role in ensuring the potential of these advancements are widely known.

Throughout 2024, the Research team has interacted with global Bitcoin miners and seen a significant shift towards the use of clean energy. Bitcoin mining in the public domain has been reported as highly energy intensive but a growing number of miners are transitioning to clean renewable energy sources, such as hydroelectric power, wind and solar, to minimise their carbon footprint. Partnerships with renewable energy providers and participation in demand response programmes have further strengthened the sector’s alignment with global sustainability goals. These initiatives not only enhance miners’ reputations but also lower operational costs, providing a dual benefit.

In addition to shifting energy sources, miners are actively investing in energy efficiency technologies to reduce environmental impact. Immersion cooling systems, which significantly cut down energy consumption by efficiently cooling mining hardware, are becoming industry standard. AI-powered optimization tools are also being implemented to monitor and dynamically adjust energy usage, further decreasing environmental impact. Gas flaring for stranded energy sources such as oil rigs has been an increasingly serious problem because flaring excess gas contributes to approximately 406 million tonnes of CO2 emissions per year. Through innovative solutions, Bitcoin mining can alleviate this problem by housing mining hardware, along with the necessary generators, in containers and being able to operate in these remote and hard-to-reach locations far from established power grids. Bitcoin miners can use the electricity grid at off-peak times (i.e. not to conflict with high demand times during adverse weather conditions for homes) to ensure that the grid usage is stabilised and used as efficiently as possible.

In the below graph from our Research team, the Bitcoin Network Power Demand has fallen over the course of 2024 due to the efficiency gains of Bitcoin mining firms and their hardware. This demonstrates the positive strides the Bitcoin mining industry have made in terms of sustainability.

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Bitcoin Network Power Demand (Annualised TWh)

Also, while the Bitcoin network hashrate continues to rise almost exponentially there is improved efficiency of the Bitcoin network overall (measured by Watt per Terahash). This is displayed below:

Bitcoin Miner Efficiency versus total hashrate

The graph below presents a powerful message that the % of energy sourced sustainably for Bitcoin mining is at its highest of 56% in 2024. The state of Texas is a good example where Bitcoin mining curtailed energy has led to the reduction in energy costs and increased profits to energy providers who have used the profits to grow renewable energy sources, i.e. wind and solar. For instance, wind power in Texas has increased to 44k MW (a 50% increase since 2019) and solar power has increased to 22k MW (a 800% increase since 2019), making it the US state with the largest renewable network. Another positive result is that the emissions intensity has fallen to 240 grams CO2/kWh during 2024.

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Bitcoin Mining Emissions & Sustainability

For the Bitcoin miners, there has been a notable shift of Bitcoin mining firms in the USA switching their operations to cater for high performance computing (“HPC”) to diversify their operations and take advantage of the growing demand for Artificial Intelligence (“AI”). As the Bitcoin mining profitability decreases due to increased miner competition and increased mining difficulty levels, the HPC and AI sector can provide new revenue streams to miners that are inaccessible to other sectors. For instance, Bitcoin miners have already secured access to large-scale energy infrastructure and have in place critical components required for operating data centres. There is a movement towards AI in energy-secure locations, with companies like Hive and Hut 8 generating income from AI. The AI data centres require energy-secure locations where an extremely high uptime for power is required (>99%), along with sophisticated redundancy systems. Conversely, Bitcoin mining does not require such high uptime and can be powered on and off within minutes as in less secure energy locations, e.g. sites using renewable energy or stranded gas flaring. Our Research team will continue to monitor the AI/HPC transition developments and report updates in the quarterly mining reports.

The convergence of financial innovation, environmental commitment, and technological advancements positions Bitcoin mining as a model for how industries can adapt to climate challenges while remaining profitable. As this trend continues, Bitcoin miners are set to become central figures in the push toward a sustainable energy future.

Cyber Security

As digital asset networks continue to evolve, security risks remain a critical concern. While advancements in blockchain technology, smart contract security, and regulatory oversight have strengthened protections, digital assets and their underlying networks still face persistent threats, including cyberattacks, software vulnerabilities, and operational failures. Addressing these risks requires continuous innovation in security protocols, proactive threat detection, and industry-wide collaboration. Even with enhanced security measures, malicious actors may still find ways to exploit vulnerabilities in digital asset networks and exchanges, potentially leading to financial losses for asset holders, as demonstrated by past incidents.

Malicious actors have historically targeted platforms and exchanges for exploitation and are now employing increasingly sophisticated tactics to attack decentralized finance (DeFi) infrastructure and smart contracts. In response to these evolving threats, we continue to enhance our cutting-edge

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cybersecurity processes and controls. Our investments include, but are not limited to, a dedicated incident response team, 24/7/365 Security Operations Centre (SOC), real-time monitoring, advanced threat intelligence, and proactive estate-wide security measures to identify and mitigate risks before they can be exploited.

As an industry leader in our sector, it is important for us to protect ourselves and our clients against financial crime. We have strong financial crime processes and procedures that provide protection but also identify bad actors and organisations. Due to the nature of the industry within which the Group operates, coupled with the nature of the services and products provided, a robust control environment is paramount to protect the Group’s stakeholders, ensure compliance with regulatory requirements of the Group, and allow for accurate and timely dissemination of information throughout the Group.

Cyber security remains a critical focus for the Group. Significant investment in and ongoing improvement of the Group’s security posture is essential to align the infrastructure of the Group with its growth. The continuous improvements have been validated by the Group’s external information security audits and accreditations. Since 2021 the Group has maintained its ISO27001 certification (an international standard for information security management), evidencing adherence to a “best- practice” approach to the management of information security by addressing people and processes as well as technology.

Company Personnel are required to complete mandatory Cyber Security training upon joining and at least annually so that they are well equipped to identify and take appropriate action for high-risk Cyber Security scenarios. This training is regularly updated to reflect emerging threats, best practices, and regulatory requirements, reinforcing a strong security culture across the organization.

Regular security tests and attack simulations are conducted to reinforce employee awareness and engagement in cybersecurity best practices. The Group continuously monitors its endpoint, mobile, and perimeter security protections to adapt to evolving threats and maintain a strong defence against emerging cyber risks. Additionally, the Group’s cybersecurity controls undergo routine testing as part of its Compliance Monitoring Plan, ensuring they remain effective in an increasingly complex cybersecurity landscape.

Growth & Development of Personnel & Company Culture

We aim to invest in a responsible manner to scale and preserve the company culture without adversely impacting future prospects, including the Group’s ability to retain and recruit personnel and to effectively focus on and pursue the Group’s short term and long-term objectives.

The culture within CoinShares is entrepreneurial in nature due to the novelty of the crypto assets industry. Our five guiding principles of: Lean Operation, Laser Focus, Extreme Accountability, Antifragility and Investor Centricity are ingrained into our culture. We believe it is vitally important to build a digital assets market fit for institutional investors that is both robust and well regulated.

Regulatory Compliance & Risk Management

The Group has a variety of systems and controls in place that allow for the ongoing monitoring and appropriate levels of control and oversight of all its digital asset holdings and positions with each of the exchanges and custodians it uses. This is to ensure that the Group and its clients are compliant with both local, national and international regulations, legislation and standards.

CoinShares has an experienced Regulatory Compliance and Legal team in place who are able to navigate the new digital assets regulations, e.g. MICA Financial Action Task Force (FATF) and SEC regulations. Some of the Group’s entities maintain a digital assets regulatory license (e.g. Virtual Asset Service Provider license) and the Group is fully aware of the reputational damage if any such licences

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were revoked and so an open and collaborative dialogue is maintained with the applicable regulators. In the past, the digital assets market has been fraught with nefarious actors seeking to manipulate the financial system, perform terrorist financing and/or commit investor scams. Thus, it is imperative for the Group to remain vigilant of such actors and ensure both regulatory compliance and having in place appropriate risk mitigating controls.

All exchanges and custodians with which the Group interacts for the purpose of either digital asset storage or trading are subject to stringent counterparty onboarding and ongoing due diligence checks. These are integrated fully with the Group’s internal systems prior to engaging in any kind of active relationship. Exchanges and Custodians are all subject to risk-based periodic reviews.

This risk of the Group is further mitigated by the fact that most of the Group’s physical asset holdings are in custody with regulated and reputable digital assets custodians in equivalent jurisdictions such as Zodia Custody and Komainu Jersey, who act at arm’s length to the Group.

Risk Management is an ongoing focus for the Group, and we have entered into a number of Account Control Agreements (“ACAs”) with CoinShares’ trading counterparties to mitigate exchange risk. Counterparty risk management is a priority in the nascent crypto market industry to ensure that CoinShares has the adequate protection and recourse in case of any counterparty defaults. The rollout of the Portfolio and Risk Monitoring system, Haruko, has led us to be more effective in monitoring real-time risk.
ENVIRONMENTAL INITIATIVES

The environment within which the Group operates is wide-ranging and there are both direct and indirect impacts from company activities. The Group aims to minimise its carbon footprint as much as possible and employs effective company stewardship to enable positive climate change action. The Group’s activities have limited direct environmental impact; however, we prioritise the issue because we know it is important to run our business in a way that minimises our ecological footprint and leaves the environment in a better state for future generations.

In 2024, CoinShares conducted a Carbon Footprint Assessment of our main office locations with our third-party sustainability partner, Futuretracker. The aim of the assessment was to measure the overall carbon footprint of the CoinShares including our office locations, vendors and our major stakeholders. The results of the assessment showed that in comparison to other financial institutions headquartered in the Channel Islands, our total carbon footprint is below the industry average. This assessment helped CoinShares to understand our material CO2 emissions and to focus the priorities on our ESG and sustainability initiatives. For 2024 CoinShares reported a total of 847.81 tCO2e in total emissions across Scope 1-3 emissions. There were zero Scope 1 emissions to report for CoinShares and the Scope 3 emissions comprised of the majority of our total emissions emanating from our Top 10 supplier list and business travel.

Climate Change Initiatives

We continued our support of the Jersey Trees for Life organisation by allowing CoinShares employees time away from work to clear paths and help maintain the health of the trees (Alder Collection Restoration) with the local Jersey community. This initiative assisted our local community in reducing our carbon footprint as well as preserving wildlife living in their habitats. The Alder Collection Restoration Project, an extension of the Alder Collection, which has been planted and maintained by Jersey Trees for Life since the early 1990’s, is designed to protect and restore the trees, habitats of endangered species, and improve the livelihoods of thousands of people who will be able to enjoy the site in the future.

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The London office made a charitable donation to the Leaves Breathe project. Leaves Breathe exists to advance environmental protection through the creation and enhancement of valuable community green spaces across Greater London. The project focuses on areas where there are few green spaces or where there is a specific need to improve existing green spaces for the use of local communities. Leaves Breathe especially supports those areas where there is less opportunity for, or access to, funding for community green spaces.
SOCIAL INITIATIVES

Confidence and the highest reputational standards for the Group are a crucial part of our business and critical to our success. Trust and confidence are earned by acting responsibly and by meeting or exceeding expectations. Our Social impacts relate to the relationships held with our impacted stakeholders, including employees, investors, clients, and the local community.

Our focus is on ensuring that we have the right people working in the most effective organisation structure to support the strategy of the Group - committed employees are the foundation of CoinShares’ success. Creating a stimulating, rewarding work environment where employees want to stay, and nurturing the next generation’s talents is critical to longevity and retaining the role of digital asset management market leader. CoinShares strives to be an attractive and responsible employer. Being responsible requires a long-term perspective. Skills development, diversity, compensation, and health are high-priority issues. Our work is governed by the applicable laws and regulations in the markets where the Group operates, as well as several policies such as guidelines for conduct, ethics, and human resources policies.

Money Sovereignty and Wider Cryptocurrency Adoption

In lieu of the current traditional finance model, cryptocurrencies and digital assets are designed and developed for mass adoption. The current traditional finance model caters for the developed nations who have stable economies that can manage low inflation risk whereas developing nations have high inflation risk leading to the devaluation of their citizens’ savings and incomes. Over half of the world lives in an economy of authoritarianism and/or recurring double-digit inflation. CoinShares is a staunch supporter of including billions of people in the global economy and giving them sovereignty over their money.

On one side of the coin, digital assets are able to support the financial needs of the unbanked world population. According to World Bank data, there are 1.4 billion unbanked people who lack access to financial resources, exposing a significant gap in financial inclusion in developing economies (https://www.weforum.org/stories/2024/07/why-financial-inclusion-is-the-key-to-a-thriving-digital- economy/). This unbanked population do not have access to banking and bank fees for remittances to send money cross-border are exorbitant (i.e. average rate of 6.65% per transaction). The cross-border remittance of money is a real use case for developing nations due to people working in developed nations needing to send money home to families in developing nations. Cryptocurrencies such as Bitcoin remove the intermediary such as banks and other financial institutions to allow the unbanked population to keep more of their hard-earned income and gives them more financial freedom and sovereignty over their money.

On the other side of the coin, digital assets can also support the wealth generation of investors in the developed nations. CoinShares issues digital asset ETPs on regulated markets in the EU and US. The ETP’s are considered low fee and give investors easy access to the digital assets market. The ETP’s are a wealth generator for the individual investors based on the digital asset’s price appreciation. This wealth appreciation is evidenced by the greater than 90% increase in the number of crypto and Bitcoin millionaires from 1 July 2023 to 30 June 2024 displayed in this source material (https://www.henleyglobal. com/publications/crypto-wealth-report-2024). Also, CoinShares’ direct engagement in the digital

assets sector promotes the financial inclusion missing from the existing banking and financial services model. Digital assets like Bitcoin behave like gold but are arguably considered superior in that they are a store of value, weightless, highly divisible, and cheaper to both send and store.

Employee Benefits and Investor Returns

The Group strives to provide a competitive salary and benefits package to all eligible employees according to job requirements, jurisdiction and individual performance. Our employees have the opportunity to participate in the Group’s success through our incentive programs such as the Equity Incentive Program (“EIP”), of which all levels of employees are qualified to receive EIP. Employees are also eligible for consideration for a discretionary bonus annually, the sum of which is determined by both overall company performance and employee performance. The Group actively monitors the voluntary employee turnover rate of staff to identify any functional areas of improvement. Exit interviews are conducted to gain further insights and to improve retention rates. Also, we have in place paid leave and paid parental leave for our employees. In 2024, CoinShares made a total dividend payment of

£31,214,820.30 to CoinShares shareholders that comprised of both employees and outside investors. A quarterly dividend policy was announced in 2024 reflected our strategic focus on balancing growth and achieving profitability with rewarding our shareholders and promoting the Group as a dividend paying stock. Also, a special dividend was announced in 2024 in light of CoinShares’ recovery of our FTX claim and so it was essential to acknowledge the unwavering trust our investors have placed in us and to reward their loyalty.

The benefits package that the Group offers our employees varies from one operating jurisdiction to another to reflect local market conditions and legislation. Typically, this includes benefits such as a defined contribution pension plan, medical insurance, income protection/disability insurance and life insurance provided either via private insurance schemes or social security contributions. In some locations, there are fitness and wellbeing benefits offered with regular health assessments made available.

Employee Wellbeing

Employees who experience a good work-life balance are better equipped for high performance in the work environment. CoinShares regularly reviews employee benefits against market benchmarks to ensure they are fit and proper to support staff wellbeing. The Group embraces workforce diversity and promotes productivity, irrespective of physical and geographical locations. The Group has employed a return to office mandate for CoinShares staff across its operational locations to facilitate the maximum collaboration across our teams.

In 2024, the Group continued with its Social Committees in each jurisdiction in order to ensure that there is more team-based collaboration in an informal setting. The aim of the committees is to improve the employee networking effects within the organisation and maintain high engagement levels from our employees. The events organised were inclusive in nature and encouraged participation from all levels across the organisation. There is a ring-fenced yearly budget allocated to the Social Committees to organise diverse events, and we look forward to such events in the upcoming years. A highlight for CoinShares Group was the participation of 25+ London office employees in the J.P. Morgan Corporate Challenge run held in Battersea Park on 3 July 2024 along with 25,000 other racers, joggers and walkers. The London Social Committee paid for the race entrance fees for the CoinShares staff and provided food, drinks and a private hospitality area to enjoy the shared experience of fitness, friendly competition and fun. The event allowed for CoinShares staff to celebrate teamwork and camaraderie amongst the cohort. Lastly, the J.P. Morgan Corporate Challenge race fees paid for by CoinShares directly supported its main charity partner, Centrepoint. Centrepoint is the UK’s leading youth homelessness charity, supporting over 16,000 young people every year alongside its partners. Support from the J.P Morgan Corporate Challenge provided young people aged 16-24 in London with access to hardship funding to ensure financial constraints do not hold them back on their journey to independent living.

Employee Diversity, Equity and Inclusion

CoinShares is committed to promoting a diverse, equal, and inclusive working environment, where all employees feel valued and respected for who they are and for the work they contribute. The Group’s Employee handbook outlines the responsibilities of staff in relation to equal opportunities, diversity and inclusion. We instil the principle of an inclusive workplace culture with zero tolerance for discrimination or harassment. All harassment is strictly prohibited, and a reporting channel is provided to employees as a forum where the Group can handle and investigate any potential reports of harassment. The Group’s Human Resources policies strictly comply with all applicable employee local laws and regulations. As an equal opportunity employer, the Group is committed to providing equal opportunities to all employees and applicants. We create a safe working environment of mutual respect for employees that values individual contribution and recognises diversity. CoinShares upholds local laws on protecting staff from discrimination. We pride ourselves on being a meritocracy where each person is evaluated based on personal skill and merit. Moreover, the Group prohibits the use of child labour and forced or compulsory labour at all its units and suppliers.

Employee Learning and Development

CoinShares seeks to establish a workplace that provides continuous learning to employees to equip them with effective skills, knowledge, and training to meet their full potential. The Group provides new joiners with a comprehensive induction training to ensure new employees clearly understand the Group’s values and culture and efficiently integrate into the working culture. The induction programme provides information on the Group’s structure, an introduction to the different departments of the Group, an overview of company policies and procedures and other important HR-related activities. Also, the induction offers training on CoinShares’ compliance and cyber security policies and procedures.

CoinShares also provides annual training as part of the Continuing Professional Development (“CPD”) scheme to employees on financial industry ethics, compliance, anti-money laundering, insider trading, conflicts of interest, diversity and inclusion, information security and cyber risk awareness. The courses are administered and tracked by the Compliance and Human Resources teams.

CoinShares supported our Company Personnel when external courses were held. CoinShares supported a number of employees to obtain their Chartered Financial Analyst (CFA) qualifications across Levels 1, 2 and 3, Investment Management Certificates, CAIA, ACCA and CGI IFA qualifications. All personnel were given time off to attend the examinations, additional study days and financial support to access extra study materials. Our most recent successes were individual employees completing their CFA Level 2, their IMC and IFA Level 4 respectively. In addition to the professional qualification support, CoinShares offers all staff access to online training via the platform provider Coursera in a wide range of programmes from financial management for non-finance managers to leadership and development and Python programming.

Digital Assets Knowledge Share

We provide deep and thought-provoking research into the digital assets industry utilising our subject matter experts in the Research department. Our research is aimed at a wide spectrum of cryptocurrency amateurs, enthusiasts, and institutional investors. During 2024, we have published research about the quarterly Bitcoin mining reports, Bitcoin use as a strategic reserve, quantum security of Bitcoin, Trump vs. Harris (implications for Bitcoin) and our weekly digital asset fund flows reports. The Research content is shared across a variety of channels such as conferences, blogs and CoinShares Research website updates. The content thus allows for digital assets new market participants to have sufficient financial knowledge about the new and burgeoning asset class.

External Community Support & Charity

We look for opportunities where CoinShares can have a meaningful impact, with a focus on preserving local culture. We collaborate with community non-profit organisations, neighbourhood groups, and other special initiatives for local residents.

In 2024, CoinShares sponsored the Jersey Rugby Football Club (“JRFC”) and committed a £100,000 annual sponsorship fee. The sponsorship deal is three years with CoinShares positioned as the lead sponsor of the JRFC until June 2026. The partnership covers the senior men’s and women’s teams at the JRFC. As part of the agreement, the JRFC’s home ground has been rebranded as CoinShares Park, while CoinShares’ support has also sparked a major expansion of rugby development activity in Jersey schools. The overall intention is to ensure that rugby sport in the community thrives on the island. Both senior JRFC teams won their respective leagues at the end of the 2023/2024 season and have continued to thrive at higher levels after being promoted. Although established at the heart of the Island community for many years, JRFC went from strength to strength during the first year of partnership with CoinShares. Overall club membership – from the youngest ‘mini’ rugby participant to the oldest former player – now exceeds 1,000 for the first time. The rugby development work was aimed at primary and secondary schools on Jersey island with rugby tournaments held across the student year groups. During the school holidays, rugby camps were held with over 100 children attending from ages 9-11 where some were inspired by the South African Springboks team visit. In 2025, the JRFC plans to target more schools in the youth programmes, to increase numbers of participants in the Primary Tag Tournament and Lord Jersey Tournament, and lastly to have girls focussed rugby sessions.

We are proud to fund a three-year title sponsorship of the Jersey Race Club, the club which dates to 1832, and where horse racing has continued in one form or another except for during the two world wars and the 2020 season. CoinShares paid the annual sponsorship fee of £30,000 to be one of the principal sponsors of the Jersey Race Club. The sponsorship provides the financial support required for the Club to continue to host local horse racing events, affecting both local and off-Island jobs amongst jockeys, trainers, stable personnel and catering. As horse racing is a regulated sport, the welfare of its human and equine participants is considered integral to the Club. The Club meticulously treats and cares for its horses by employing its team of expert stablemen, the provision of vets and other welfare professionals.

In London, the CoinShares team joined the 2024 Crypto Football League along with 8 other crypto market participants, including Coinbase, Kraken and Galaxy Digital. The ethos behind the Crypto Football League is to bring together colleagues from across the crypto industry, to build connections through sport and improve the wellbeing and fitness of our staff. At the end of the 2024 season, the CoinShares team placed a respectable fifth place in the league table and an end of season drinks was held to celebrate with this close-knit crypto community. In 2025, the league has expanded due to the success of the 2024 season to include more crypto market participants and so the London team looks forward to more friendly rivalries and connections with the teams.

We intend to continue contributing to the global crypto community via research, events, and advocacy throughout 2025 and beyond and look forward to reporting on these efforts.

‌AUDITED FINANCIAL STATEMENTS

Company Information 59

Directors’ Report 61

Independent Auditor’s Report 63

Consolidated Statement of Comprehensive Income 70

Consolidated Statement of Financial Position 71

Consolidated Statement of Changes in Equity 72

Consolidated Statement of Cash Flows 73

Notes to the Consolidated Financial Statements 75

DIRECTORS’ REPORT

The directors present their annual report and the consolidated financial statements (the ‘financial statements’) of CoinShares International Limited (the ‘Company’), together with its subsidiaries listed in note 18(a) of the financial statements (collectively the ‘Group’), for the year ended 31 December 2024.

Incorporation

The Company is incorporated and domiciled in Jersey. The Company is registered as a public company with the Jersey Financial Services Commission and listed on Nasdaq Stockholm.

Principal activity

The principal activity of the Group is to engage in creating financial products associated with digital assets and blockchain technology.

Restatement of results

During the year the directors elected to change the accounting policy of its digital assets. The change has resulted in the Group’s results being restated for 31 December 2023. This restatement has been reflected in all pages of these consolidated financial statements. Further information can be found in note 2 of the financial statements.

Results and dividends

The total comprehensive income for the year amounted to £107,182,090 (2023: £38,396,035). The profit for the year, after taxation, amounted to £104,359,320 (2023 restated: £46,439,648).

During the year the Group declared a special dividend of £24,334,475 (2023: £nil) and declared a regular dividend of £9,250,492 (2023: £nil), of which £6,937,869 (2023: £nil) had been paid during the year.

The Group purchased 90,205 (2023:1,597,706) shares on the public market as part of a share buyback program for a total consideration of £268,995 (2023: £4,216,180). On 14 February 2024 the Group announced the cancellation of all treasury shares held 1,474,631 (2023: 200,050) with a market value of

£3,926,374 (2023: £551,399).

Statement of directors’ responsibilities

The directors are responsible for preparing the Directors’ Report and financial statements in accordance with applicable laws and regulations.

The Companies (Jersey) Law 1991 requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the Group financial statements in accordance with UK-adopted International Financial Reporting Standards. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit or loss of the Group for that period. In preparing the financial statements, the directors are required to:

select suitable accounting policies and then apply them consistently;
state whether applicable UK-adopted International Financial Reporting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
make judgements and accounting estimates that are reasonable and prudent; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group and Company’s transactions and disclose with reasonable accuracy at any time

the financial position of the Group and Company, and which enable them to ensure that the financial statements comply with the Companies (Jersey) Law 1991. They are also responsible for safeguarding the assets of the Group and Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in Jersey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

So far as the directors are aware, there is no relevant audit information of which the Company’s auditors are unaware, and each director has taken all the steps he or she ought to have as a director in order to make himself or herself aware of any relevant audit information and to establish that the Group’s auditors are aware of that information.

Directors

The directors who held office during the year and subsequently are set out on page 59.

Company Secretary

The Company Secretary who held office during the year and subsequently is set out on page 59.

Going concern

The Group had net assets of £313,955,299 (2023: £239,245,005) and total comprehensive income of

£107,182,090 (2023: £38,396,035). The directors have prepared these financial statements on a going concern basis on the understanding that they have satisfied themselves that sufficient working capital will be available for 12 months from the date of issue of these financial statements.

The Group has an obligation to settle amounts due to investors for Exchange Traded Products (‘ETP’) that reference the performance of specific digital assets issued. The Group holds hedging assets in excess of this liability, the directors consider that they will be able to convert digital assets to fiat currency so as to settle the obligations in the event that certificates are redeemed and so deem the going concern risk associated with these certificates to not be material. In addition, delays in the settlement of the certificates may be imposed or certain modifications be made in the occurrence of market illiquidity or other disruptions.

Furthermore, the directors deem the cyber security policies and procedures of the Group to be sufficient to mitigate cyber risk and the risk of theft of digital assets that could potentially leave the Group unhedged and exposed in its obligation to certificate holders.

Accordingly, the directors have prepared the financial statements on a going concern basis.

Post balance sheet events

Events subsequent to the year end have been disclosed in note 20.

Independent auditor

In accordance with the Company’s articles, a resolution proposing that Baker Tilly Channel Islands Limited be reappointed as auditor of the Group will be put at the Annual General Meeting on 30 May 2025.

The report was approved by the board on 31 March 2025 and signed on its behalf.

...........................................................

Jean-Marie Mognetti Director

INDEPENDENT AUDITOR’S REPORT

To the Members of CoinShares International Limited

Opinion

We have audited the consolidated financial statements of CoinShares International Limited (the “Company” and, together with its subsidiaries, the “Group”), which comprise the consolidated statement of financial position as at 31 December 2024, and the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including material accounting policy information.

In our opinion, the accompanying consolidated financial statements:

give a true and fair view of the consolidated financial position of the Group as at 31 December 2024, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with IFRS Accounting Standards as adopted by the United Kingdom (IFRSs); and
have been prepared in accordance with the requirements of the Companies (Jersey) Law 1991, as amended.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs) and applicable law. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group and Company in accordance with the ethical requirements that are relevant to our audit of the Consolidated Financial Statements in Jersey, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by us, including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.


Key audit matter	How our audit addressed the matter	Key observations communicated to those charged with governance
Valuation of investments There is a risk that investments could be materially misstated and incorrectly disclosed in the consolidated financial statements. - Total value: £19,998,654 (2023: £44,924,207) - As disclosed in note 12.	We understood and evaluated the valuation methodology applied with reference to the International Private Equity and Venture Capital Valuation guidelines (IPEV), and tested the techniques used by the Directors in determining the fair value of material unquoted investments. To test the value we undertook the following: - Assessed the appropriateness of the valuation methodology used and tested the inputs either through validation to appropriate third party sources, or where relevant, assessed the reasonableness of significant estimates and judgements used; - Compared valuations of investments in funds to the most recent audited financial statements, where available; - Compared valuations to recent transactions, where relevant; and - Compared valuations to recent investments made in investee companies where there was a significant new investor.	No issues were identified that were required to be communicated to those charged with governance.
Existence and rights and obligations in respect of investments There is a risk that investments do not exist, or the group does not hold title to the investments. - Total value: £19,998,654 (2023: £44,924,207) - As disclosed in note 12.	For each material investment held by the Group we have obtained third party confirmation of ownership.	No issues were identified that were required to be communicated to those charged with governance.
Digital asset: Existence, Rights and Obligations There is a risk that the Group does not own or control the digital assets which would result in a material misstatement in the consolidated financial statements. - Total value: £3,627,205,369 (2023: £2,377,652,328) - As disclosed in note 9.	Our substantive procedures included performing the following: - Obtained confirmations from the custodian and centralised exchanges, where available; - Performed on-chain testing where wallets were directly held; - Performed a stocktake of digital assets held via decentralised wallets; and - We understood and evaluated the procedures relating to the process of assessing the reliability of the custodian both at take on and throughout the relationship.	No issues were identified that were required to be communicated to those charged with governance.


Key audit matter	How our audit addressed the matter	Key observations communicated to those charged with governance
Digital assets – Valuation There is a risk that the value attached to the digital assets is materially misstated. - Total value: £3,627,205,369 (2023: £2,377,652,328) - As disclosed in note 9.	We have obtained prices used in the valuation and compared to a third-party source to determine the reasonableness of the price and the level which has been applied.	No issues were identified that were required to be communicated to those charged with governance.
ETP liabilities: Completeness, Rights and Obligations There is a risk that the ETP liability is not fully recognised which would materially misstate the consolidated financial statements. - Total value: £4,171,982,360 (2023: £2,351,475,523) - As disclosed in note 11.	We have obtained confirmations from the relevant third parties who issue the ETP liability certificates and compared this to the financial records to ensure the liabilities exist.	No issues were identified that were required to be communicated to those charged with governance.
ETP liability – Valuation There is a risk that the value attached to the ETP liability is materially misstated. - Total value: £4,171,982,360 (2023: £2,351,475,523) - As disclosed in note 11.	The valuation of the certificates has been tested by: - Recomputing the underlying digital asset allocation as per the prospectus; and - Comparing prices used in the valuation of underlying digital assets to third party sources to determine reasonableness.	No issues were identified that were required to be communicated to those charged with governance.

Our Application of Materiality

Materiality for the consolidated financial statements as a whole was set at £9,418,000 (2023: £7,163,000), determined with reference to a benchmark of net assets, of which it represents 3% (2023: 3%).

In line with our audit methodology, our procedures on individual account balances and disclosures were performed to a lower threshold, performance materiality, so as to reduce to an acceptable level the risk that individually immaterial misstatements in individual account balances add up to a material amount across the consolidated financial statements as a whole.

Performance materiality was set at 60% (2023: 60%) of materiality for the consolidated financial statements as a whole, which equates to £5,650,800 (2023: £4,297,800). We applied this percentage in our determination of performance materiality because we deem the digital asset activities undertaken by the Group to be high risk.

We reported to the Audit Committee any uncorrected omissions or misstatements exceeding

£470,000 (2023: £358,000), in addition to those that warranted reporting on qualitative grounds.

Of the Group’s 20 (2023: 19) reporting components, including the Company, we subjected 8 (2023: 4) to full scope audits. The work on all the components was performed by the Group audit team. The components within the scope of our audit accounted for 90% (2023: 90%) of the Group’s net assets.

Conclusions relating to Going Concern

In auditing the consolidated financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the consolidated financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group and Company’s ability to continue as a going concern for a period of at least twelve months from when the consolidated financial statements are authorised for issue.

Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report.

Other Information

The other information comprises the information included in the annual report other than the consolidated financial statements and our auditor’s report thereon. The Directors are responsible for the other information contained within the annual report. Our opinion on the consolidated financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the consolidated financial statements themselves. If, based on the work performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Matters on which we are required to Report by Exception

In the light of the knowledge and understanding of the Group and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors’ report.

We have nothing to report in respect of the following matters in relation to which the Companies (Jersey) Law 1991, as amended, requires us to report to you if, in our opinion:

proper accounting records have not been kept;
proper returns adequate for the audit have not been received from branches not visited by us;
the consolidated financial statements are not in agreement with the accounting records and returns; or
we have not obtained all information and explanation that, to the best of our knowledge and belief, was necessary for the audit.

Responsibilities of the Directors

As explained more fully in the Directors’ responsibilities statement set out on page 61, the Directors are responsible for the preparation of consolidated financial statements that give a true and fair view in accordance with IFRSs, and for such internal control as the Directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the Directors are responsible for assessing the Group and Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Directors are responsible for overseeing the Group’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:
Enquiry of management to identify any instances of non-compliance with laws and regulations, including actual, suspected or alleged fraud;
Reading minutes of meetings of the Board of Directors;
Review of legal invoices;
Review of management’s significant estimates and judgements for evidence of bias;
Review for undisclosed related party transactions;
Review the detail agreements in respect of all fees and reperform the calculations with reference to these agreements;
Using analytical procedures to identify any unusual or unexpected relationships; and
Undertaking journal testing, including an analysis of manual journal entries to assess whether there were large and/or unusual entries pointing to irregularities, including fraud.

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02

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A further description of the auditor’s responsibilities for the audit of the financial statements is located at the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities.

This description forms part of our auditor’s report.

Report on the examination of the ESEF report Opinion

In addition to our audit of the annual report, we have also examined that the Board of Directors have prepared the annual report in a format that enables uniform electronic reporting (the ESEF report) pursuant to Chapter 16, Section 4(a) of the Swedish Securities Market Act (2007:528) for CoinShares International Limited for the year ended 31 December 2024.

Our examination and our opinion relate only to the statutory requirements.

In our opinion, the ESEF report has been prepared in a format that, in all material respects, enables uniform electronic reporting.

Basis for opinion

We conducted our examination in accordance with International Standard on Assurance Engagements (UK) 3000 Assurance Engagements Other Than Audits Or Reviews of Historical Financial Information. Our responsibilities under those standards are further described in the Auditor’s responsibilities section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant in Jersey, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of the Board of Directors

The Board of Directors is responsible for the preparation and fair representation of the ESEF report in accordance with Chapter 16, Section 4(a) of the Swedish Securities Market Act (2007:528), and for such internal control as the Board of Directors determines is necessary to enable the preparation of the ESEF report that is free from material misstatement, whether due to fraud or error.

Auditor’s responsibilities

Our objectives are to obtain reasonable assurance about whether the ESEF report is in all material respects prepared in a format that meets the requirements of Chapter 16, Section 4(a) of the Swedish Securities Market Act (2007:528), based on the procedures performed. Reasonable assurance is a high level of assurance, but it is not a guarantee that an engagement carried out in accordance with ISAE (UK) 3000 will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the ESEF report.

We apply ISQM (UK) 1 Quality Management for Firms that Perform Audits or Reviews of Financial Statements, Or Other Assurance Or Related Services Engagements and accordingly we maintain a comprehensive system of quality management, including documented policies and procedures regarding compliance with professional ethical requirements, professional standards and legal and regulatory requirements.

The examination involves obtaining evidence, through various procedures selected using our judgement, that the ESEF report has been prepared in a format that enables uniform electronic reporting of the annual report.

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The examination included:
Consideration of those elements of internal control that are relevant to the preparation of the ESEF report by the Board of Directors;
Evaluating that the ESEF report has been prepared in a valid format; and
Reconciling the ESEF report with the audited annual report.

Auditor’s report on the Board of Directors Report, Corporate Governance Report and Sustainability Report

Based on our audit of the consolidated financial statements as described above, it is our opinion that the information presented in the Board of Directors Report, Corporate Governance Report and Sustainability Report concerning the financial statements and the going concern assumption is consistent with the consolidated financial statements and complies with the applicable laws and regulations.

Other Matters which we are Required to Address

We were appointed by the Board of Directors on 26 August 2020 to audit the consolidated financial statements. Our total uninterrupted period of engagement covers 5 financial reporting periods.

The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Group and we remain independent of the Group in conducting our audit.

Our audit opinion is consistent with the additional report to the audit committee in accordance with ISAs.

Use of this Report

This report is made solely to the Members of the Company, as a body, in accordance with Article 113A of the Companies (Jersey) Law 1991, as amended. Our audit work has been undertaken so that we might state to the Members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and its Members, as a body, for our audit work, for this report, or for the opinions we have formed.

Hafeez Azeez

For and on behalf of Baker Tilly Channel Islands Limited

Chartered Accountants St Helier, Jersey

Date: 31 March 2025

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2024


	Note	2024 £	2023 Restated £
Revenue	5(a)	87,332,805	43,082,721
Cost of sales	7(a)	(13,379,248)	(5,687,494)
Gross profit		73,953,557	37,395,227
Administrative expenses	7(b)	(34,775,343)	(26,112,691)
Other operating income	5(b)	34,090,608	27,274,329
Gain on digital assets held as inventory	9(a)	1,345,171,305	1,103,014,326
Gain on digital assets held for collateral purposes	9(b)	574,218,492	183,662,946
Loss on certificate liability	11(e)	(2,396,252,307)	(1,470,485,132)
Other operating gains through profit and loss	11	502,477,326	191,994,105
Operating profit		98,883,638	46,743,110
Non-recurring income	5(c)	28,787,099	-
Fair value (loss)/gain on investments through profit and loss	12	(387,283)	11,365,752
Impairment/loss on associates	12	(19,813,328)	(10,590,566)
Finance income	7(c)	6,642,330	6,397,041
Finance costs	7(c)	(9,021,684)	(6,902,019)
Profit before tax		105,090,772	47,013,318
Tax expense	8	(731,452)	(573,670)
Profit after tax		104,359,320	46,439,648
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Exchange differences on translation of foreign operations		3,174,922	(8,192,795)
Items that will not be reclassified subsequently to profit or loss		3,174,922	(8,192,795)
Fair value gain on financial assets through other comprehensive income		(352,152)	149,182
		(352,152)	149,182
Total other comprehensive income/(loss)		2,822,770	(8,043,613)
Total comprehensive income		107,182,090	38,396,035
Adjusted earnings per share
Basic	24	1.56	0.69
Diluted	24	1.48	0.65
The notes on pages 75 to 144 are an integral part of these financial statements

COINSHARES 2024 ANNUAL REPORT

70 | 145

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2024


	Note	31 December 2024 £	31 December 2023 Restated £	1 January 2023 Restated £
ASSETS
Non-current assets
Property, plant and equipment	13(a)	2,406,144	3,065,552	1,935,862
Digital assets held as inventory	9(a)	-	1,331,614	111,978
Goodwill	13	2,247,287	941,507	943,484
Other intangible assets	13	8,858,113	9,716,511	11,048,448
Investments	12	19,998,654	25,110,879	14,607,957
Investments in associates	12	-	19,813,328	30,403,893
Trade and other receivables	11(a)	1,256,818	328,614	806,052
Other non-current assets	11(b)	894,377	2,211,742	1,968,199
		35,661,393	62,519,747	61,825,873
Current assets
Cash and cash equivalents	11(c)	19,859,572	25,507,944	134,768,904
Digital assets held as inventory	9(a)	2,442,813,368	1,896,954,602	750,991,303
Digital assets held for collateral purposes	9(b)	1,184,392,369	478,895,757	117,931,214
Other current assets	11(b)	1,113,357,091	266,093,775	177,565,924
Trade and other receivables	11(a)	2,977,315	2,241,203	1,458,179
		4,763,399,715	2,669,693,281	1,182,715,524
Total assets		4,799,061,108	2,732,213,028	1,244,541,397
LIABILITIES
Current liabilities
Certificate liability	11(e)	(4,171,982,360)	(2,351,475,523)	(986,707,490)
Amounts due to brokers	11(d)	(79,011,258)	(669,402)	-
Trade and other payables	11(f)	(10,523,355)	(5,612,218)	(3,969,783)
Other current liabilities	11(g)	(201,457,063)	(108,940,878)	(27,116,746)
Current lease liabilities	13(b)	(583,820)	(563,633)	(1,307,507)
Current tax liabilities	8	(91,987)	(156,970)	(235,814)
		(4,463,649,843)	(2,467,418,624)	(1,019,337,340)
Net current assets		299,749,872	202,274,657	163,378,184
Non-current liabilities
Non-current lease liabilities	13(b)	(1,801,699)	(2,404,272)	(28,980)
Non-current loans	11(g)	(19,654,267)	(23,145,127)	(21,433,967)
		(21,455,966)	(25,549,399)	(21,462,947)
Total liabilities		(4,485,105,809)	(2,492,968,023)	(1,040,800,287)
Net assets		313,955,299	239,245,005	203,741,110
EQUITY
Share capital	14(a)	33,006	33,667	33,766
Share premium	14(a)	30,223,904	30,690,938	30,781,210
Other reserves	14(b)	19,399,182	11,582,904	22,136,272
Retained earnings		264,299,207	196,937,496	150,789,862
Total equity		313,955,299	239,245,005	203,741,110

The financial statements on pages 70 to 74 were approved and authorised for issue by the board of directors and signed on its behalf by:

.............................................

Jean-Marie Mognetti Director

Date: 31 March 2025

The notes on page 75 to 144 are an integral part of these financial statements.

COINSHARES 2024 ANNUAL REPORT

71 | 145

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2024


	Note	Share capital £	Share premium £	Other reserves £	Retained earnings £	Total equity £
At 31 December 2022 (Restated)		33,766	30,781,210	22,136,272	150,789,862	203,741,110
Profit for the year		-	-	-	46,439,648	46,439,648
Other comprehensive loss for the year		-	-	(8,192,795)	149,182	(8,043,613)
Total comprehensive income		-	-	(8,192,795)	46,588,830	38,396,035
Share buybacks		-	-	(4,216,180)	-	(4,216,180)
Share based payments		-	-	1,324,818	-	1,324,818
Share cancellations		(99)	(90,272)	551,399	(461,028)	-
Share options exercised		-	-	(20,610)	19,832	(778)
Total transactions with owners recognised in equity		(99)	(90,272)	(2,360,573)	(441,196)	(2,892,140)
At 31 December 2023 (Restated)		33,667	30,690,938	11,582,904	196,937,496	239,245,005
Profit for the year		-	-	-	104,359,320	104,359,320
Other comprehensive income for the year		-	-	3,174,922	(352,152)	2,822,770
Total comprehensive income		-	-	3,174,922	104,007,168	107,182,090
Share buybacks	14	-	-	(268,994)	-	(268,994)
Share option related charges		-	-	-	199,319	199,319
Share based payments	14	-	-	1,047,092	-	1,047,092
Share cancellations	14	(730)	(665,835)	3,863,258	(3,259,809)	(63,116)
Share options exercised	14	69	198,801	-	-	198,870
Dividends paid	14	-	-	-	(33,584,967)	(33,584,967)
Total transactions with owners		(661)	(467,034)	4,641,356	(36,645,457)	(32,471,796)


recognised in equity
At 31 December 2024	33,006	30,223,904	19,399,182	264,299,207	313,955,299

The notes on pages 75 to 144 are an integral part of these financial statements.

COINSHARES 2024 ANNUAL REPORT

72 | 145

CONSOLIDATED STATEMENT OF CASH FLOWS (1/2)

FOR THE YEAR ENDED 31 DECEMBER 2024


	Note	2024 £	2023 Restated £
Cash flows from operating activities
Prrofit after tax		104,359,320	46,439,648
Adjustments for:
- Depreciation of property, plant and equipment	13(a)	227,229	201,619
- Depreciation of right-of-use assets	13(a)	567,161	1,211,439
- Impairment expense	16(b)	1,632,262	-
- Amortisation of other intangible assets	13(d)	1,567,451	1,789,875
- Share-based payment expense	23	1,000,202	1,324,818
- Finance and other income	7(c)	(6,668,416)	(10,224,023)
- Finance costs and other expenses	7(c)	9,038,384	6,902,019
- Income tax expense	8	731,452	573,670
- Other operating gains through profit and loss	11	(484,920,879)	(188,837,891)
- Loss on certificate liability	11(e)	2,396,252,307	1,470,485,132
- (Gain)/loss on digital assets	9	(1,920,111,468)	(1,286,617,112)
- Loss on investments	12	267,914	(11,365,752)
- Impairment of/loss on associates	12	19,813,328	10,590,566
- Gain on foreign exchange		(17,239,105)	(3,156,213)
- Other operating income/gains	5(b)	(44,580,148)	(22,195,819)
- Trading expenses		104,632	119,206
		62,041,626	17,241,182
Changes in working capital: - Trade receivables and other assets	11(a)	(345,121,694)	82,860,609
- Trade payables and other liabilities	11(f)	587,039	651,049
		(282,493,029)	100,752,840
Changes in operating activities:
- Net (purchases)/sales of digital assets		887,936,844	(62,412,704)
- Net sales of ETP liabilities		(666,292,213)	(137,854,204)
Cash (used in)/generated from operations		(60,848,398)	(99,514,068)
Finance costs paid	7(c)	(8,594,684)	(6,614,612)
Income taxes paid	8	(249,110)	(650,644)
Net cash flow (used in)/generated from operating activities		(69,692,192)	(106,779,324)
Cash flows from investing activities
Purchases of other intangible assets	13(d)	(1,186,747)	(845,056)
Disposals of other intangible assets	13(d)	-	(282,287)
Purchases of property, plant and equipment	13(a)	(144,636)	-
Disposals of property, plant and equipment	13(a)	-	162,806
Acquisition of subsidiaries		21,423	-
Acquisition of other investments through profit and loss	12	3,682,131	(426,917)
Acquisition of other investments through other comprehensive income		195,425	-
Finance income	7(c)	6,642,601	8,299,340
Net cash generated/(used in) from investing activities		9,210,197	6,907,886

COINSHARES 2024 ANNUAL REPORT

73 | 145

CONSOLIDATED STATEMENT OF CASH FLOWS (2/2)

FOR THE YEAR ENDED 31 DECEMBER 2024


	Note	2024 £	2023 Restated £
Cash flows from financing activities
Issue of shares		247,348	-
Share premium		198,801	-
Repayment of long term loan	11(g)	(2,165,776)	(61,488)
Repayment of lease liabilities	13(b)	(443,906)	(588,487)
Cash payments for the interest portion of lease liabilities	13(b)	(142,999)	(77,866)
Share option liquidations	14	194,035	(14,307)
Share buybacks	14	(268,994)	(3,651,252)
Dividends paid		(32,813,569)	-
Increase on net amount due to brokers		76,839,497	669,401
Net cash (used in)/generated from financing activities		41,644,437	(3,723,999)
Net (decrease)/increase in cash and cash equivalents		(18,837,558)	(103,595,437)
Cash and cash equivalents At the beginning of the year		25,507,944	134,768,902
Effects of currency translation on cash and cash equivalents		13,188,855	(5,665,521)
At the end of the year		19,859,241	25,507,944
Cash and cash equivalents comprise Cash at bank	11(c)	5,764,446	6,660,753
Amounts due from brokers	11(c)	5,743,370	16,270,974
Amounts due from exchanges	11(c)	8,351,756	2,576,217
Cash overdraft	11(g)	(331)	-
At the end of the year		19,859,241	25,507,944
The notes on pages 75 to 144 are an integral part of these financial statements.

COINSHARES 2024 ANNUAL REPORT

74 | 145

CONTENTS TO THE NOTES TO THE CONSOLIDATED

FINANCIAL STATEMENTS

General information and material accounting policies
Change in accounting policy
Significant events in the current reporting period

Numerical information - Statement of Comprehensive Income
Operating segment information
Revenue and other income
Material profit or loss items
Other income and expense items
Income tax expense

Numerical information - Statement of Financial Performance
Digital assets
Hedging activities
Financial assets and liabilities
Other financial assets –Investments
Non-financial assets and liabilities
Equity

Risk
Critical estimates, judgements and errors
Financial risk and capital management

Group Structure
Business combination
Interests in other entities

Contingent items
Commitments
Events occurring after the reporting period

Further details
Cash flow information
Related party transactions
Share-based payments
Earnings per share
Summary of other accounting policies

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135

136

137

138

141

142

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

General information and material accounting policies

CoinShares International Limited (the ‘Company’) and its subsidiaries (together the ‘Group’) primarily operates in Jersey, Channel Islands (see note 18 for other jurisdictions in which the Group operates). The principal activity of the Group is providing exposure to the digital asset ecosystem via a range of financial products and services, supported by its technology stack and team.

The Company is a public company limited by shares and is incorporated and domiciled in Jersey. The address of its registered office is 2nd Floor, 2 Hill Street, St Helier, Jersey JE2 4UA.

These notes form an integral part of and should be read in conjunction with the accompanying consolidated financial statements (the ‘financial statements’).

The material accounting policies of the Group are disclosed below. Policies impacting upon specific areas of the accounts are included within the relevant section of the notes to the financial statements.
1. Basis of preparation
  
  These financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with UK-adopted International Financial Reporting Standards (‘IFRS’) and the Companies (Jersey) Law 1991.
  
  The financial statements are presented in Pound Sterling, which is also the functional currency. Monetary amounts in these financial statements are rounded to the nearest pound, except when otherwise indicated.
  
  The preparation of financial statements in compliance with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Group accounting policies.
  
  The following material accounting policies have been applied:
2. Separate financial statements
  
  Under Article 105(11) of the Companies (Jersey) Law 1991, the directors of a holding company need not prepare separate financial statements. Accordingly, these financial statements present the results of the Group headed by the Company.
3. Going concern basis
  
  The Group had net assets of £313,955,299 (2023: £239,245,005), an operating profit of £98,883,638 (2023: £46,743,110), and total comprehensive income of £107,182,090 (2023: £38,396,035). The directors have prepared these financial statements on a going concern basis on the understanding that they have satisfied themselves that sufficient working capital will be available for 12 months from the date of issue of these financial statements.
  
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  04
  
  05
  
  06
  
  07
  
  08
  
  The Group has an obligation to settle amounts due to investors for Exchange Traded Products (‘ETP’) that reference the performance of specific digital assets issued. The Group holds hedging assets in excess of this liability, the directors consider that they will be able to convert digital assets to fiat currency so as to settle the obligations in the event that certificates are redeemed and so deem the going concern risk associated with these certificates to not be material. In addition, delays in the settlement of the certificates may be imposed or certain modifications be made in the occurrence of market illiquidity or other disruptions.
  
  Furthermore, the directors deem the cyber security policies and procedures of the Group to be sufficient to mitigate cyber risk and the risk of theft of digital assets that could potentially leave the Group unhedged and exposed in its obligation to certificate holders.
  
  Accordingly, the directors have prepared the financial statements on a going concern basis.
4. Basis of consolidation
  
  The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries) made up to 31 December each year. Control is achieved when the Group:
  - has power over the investee;
  - is exposed, or has rights, to variable returns from its involvement with the investee; and
  - has the ability to use its power to affects its returns.
    
    The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above.
    
    When the Group has less than a majority of the voting rights of an investee, it considers that it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Group considers all relevant facts and circumstances in assessing whether or not the Group’s voting rights in an investee are sufficient to give it power, including:
  - the size of the Group’s holding of voting rights relative to the size and dispersion of holdings of the other vote rights;
  - potential voting rights held by the Group, other vote holders or other parties;
  - rights arising from other contractual arrangements; and
  - any additional facts and circumstances that indicate that the Group has, or does not have, the current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholders’ meetings.
    
    Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Specifically, the results of subsidiaries acquired or disposed of during the year are included in profit or loss from the date the Group gains control until the date when the Group ceases to control the subsidiary.
    
    Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with the Group’s accounting policies. All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between the members of the Group are eliminated on consolidation.
    
    Changes in the Group’s interests in subsidiaries that do not result in a loss of control are accounted for as equity transactions. The carrying amount of the Group’s interests are adjusted to reflect the changes in their relative interests in the subsidiaries.
    
    01
    
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    05
    
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    When the Group loses control of a subsidiary, the gain or loss on disposal recognised in profit or loss is calculated as the difference between (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying amount of the assets (including goodwill), less liabilities of the subsidiary. All amounts previously recognised in other comprehensive income in relation to that subsidiary are accounted for as if the Group had directly disposed of the related assets or liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to another category of equity as required/permitted by applicable IFRS Standards).

Change in accounting policies

The Group has elected to change its accounting policy for its digital assets. Previously, all digital assets were classified as IAS 38 intangible assets and measured using the revaluation model with all gains above any previously recognised losses being shown in other comprehensive income. The directors have concluded that under this revised policy they can either be classified as:

Digital assets held as inventory, measured at fair value less costs to sell in accordance with IAS 2 - inventories (‘IAS 2’); or
Intangible assets held for collateral purposes, subject to IFRS 9 - financial instruments for hedge accounting (‘IFRS 9’).

This change enhance the reliability and relevance of financial information presented, while remaining presented in accordance with IFRS aligning more closely to its conceptual framework.

There is no effect on the Total Comprehensive Income of the Group as a result of the change in accounting policy.

Application of IAS 2 and IFRS 9

The Group holds digital assets for different purposes, namely;
to trade in accordance with the Collateral Management Agreement in respect of the Group’s CoinShares XBT Provider AB (‘XBTP’) product suite;
to collaterise the exchange traded products issued by its wholly owner subsidiary CoinShares Digital Securities Limited (‘CSDSL’); and
as investments with a view to sell in order to generate realised gains.

The IFRS Interpretations Committee (IFRIC) concluded in their agenda decision titled “Holdings of Cryptocurrencies”, published in June 2019, that IAS 2 Inventories applies to digital assets when they are either held for sale in the ordinary course of business, or being inventory held by an entity that is considered to be a broker-trader, described as an entity which buys or sells commodities for others or on their own account.

The directors have thus concluded that assets held to trade in accordance with the Collateral Management agreement in respect of the Group’s XBTP product suite and assets held as investments with a view to sell in order to generate realised gains meet the criteria of IAS 2. Digital assets held as inventory are held at fair value less cost to sell using the accounting principles set out in IAS 2 paragraph 5 relating to commodity broker-traders.

For the remaining digital assets held to collaterise the ETP’s issued by CSDSL, the directors have concluded that these meet the criteria for hedge accounting under IFRS 9 and qualify for fair value hedge accounting. The digital assets held as collateral are designated as a hedged item. These digital assets have always acted as a natural economic hedge to certain ETPs issued by the Group, demonstrating that such a designation was not made in hindsight, allowing for the retrospective application of hedge accounting.

Impact of change in accounting policy

The principal effect of these changes in designation as outlined above results in (i) gains and losses on digital assets previously recognised within Other Comprehensive Income under IAS 38 to be taken through profit and loss and (ii) the removal of any associated revaluation reserve from equity via transfer to retained earnings. The impact on the financial statements of the group for the period ended 31 December 2023 is outlined below.

Statement of Comprehensive Income - Profit and Loss


	Revaluation model	Effect of policy change	Fair value less costs to sell
through OCI	through OCI	through profit
£	£	and loss £
For the year ended 31 December 2023 Gain on digital assets	787,050,987	(787,050,987)	-
Gain on digital assets held as inventory	-	1,102,954,166	1,102,954,166

Gain on digital assets held for collateral purposes

- 183,662,946 183,662,946

Total effect of policy change - 499,566,125 -

(Loss)/profit after tax (453,126,477) 499,566,125 46,439,648

All digital asset gains recognised through profit and loss under the IAS 38 revaluation model relate to the reversal of previously recognised losses only.

As a result of the policy change, all movements on digital assets are now being taken at fair value through profit and loss, designated as either gain/(loss) on (i) digital assets held as inventory or (ii) digital assets held for collateral purposes.

The effect of this change for the Group’s results for the year ended 31 December 2023 amounts to an additional gain of £499,566,123 being taken at fair value through profit and loss. This brings the Group’s loss after tax from £453,126,477 to a profit after tax of £46,439,648.

Statement of Comprehensive Income - Other Comprehensive Income


	Revaluation model	Effect of policy change	Fair value less costs to sell
through OCI	through OCI	through profit
£	£	and loss £
For the year ended 31 December 2023 (Loss)/profit after tax	(453,126,477)	499,566,125	46,439,648
Gain/(loss) on digital assets through OCI	499,566,125	(499,566,125)	-
Other losses through OCI	(8,043,613)	-	(8,043,613)
Total comprehensive income	38,396,035	-	38,396,035

Under the IAS 38 revaluation model, all digital asset gains in excess of the initial cost price are taken through other comprehensive income.

As a result of the policy change these gains are now taken at fair value through profit and loss, designated as either gain/(loss) on (i) digital assets held as inventory or (ii) digital assets held for collateral purposes.

The effect of this change for the Group’s results for the year ended 31 December 2023 amounts to a reduction in the gain on digital assets through OCI reducing by £499,566,125, equivalent to the corresponding move seen in profit and loss as above.

There is no effect on the Total Comprehensive Income of the Group as a result of the change in accounting policy.


Statement of Financial Position - Assets
	Revaluation model through OCI £	Effect of policy change through OCI £	Fair value less costs to sell through profit and loss £
As at 31 December 2023
Digital assets	2,375,850,359	(2,375,850,359)	-
Digital assets held as inventory	-	1,896,954,602	1,896,954,602
Digital assets held as collateral purposes	-	478,895,757	478,895,757
Total digital assets	2,375,850,359	-	2,375,850,359

The effect of the policy change on the Group’s statement of financial position has resulted in a reclassification of digital assets to either digital assets held as inventory or digital assets held for collateral purposes.

The effect of this policy change on the total assets, total liabilities an therefore net assets of the Group is nil.


Statement of Financial Position - Equity
	Revaluation model through OCI £	Effect of policy change through OCI £	Fair value less costs to sell through profit and loss £
As at 31 December 2023
Share capital and premium	30,724,605	-	30,724,605
Other reserves	454,110,087	(442,527,185)	11,582,902
Retained earnings	(245,589,687)	442,527,185	196,937,498
Total digital assets	239,245,005	-	239,245,005

The effect of the change in policy has mitigated the requirement for the digital asset revaluation reserve within equity, given all movements on digital assets are taken at fair value through profit and loss. Therefore this reserve of £442,527,185 has been taken to retained earnings.

There has been no change to total equity or distributable reserves as a result of the policy change.


Earnings per share	IAS 38 - Intangibles Revaluation model £	Effect of policy change £	IAS 2 - Inventory and IFRS 9 - Financial Instruments through profit and loss £
As at 31 December 2023
(Loss)/profit after tax	(453,126,477)	499,566,125	46,439,648
Share capital - basic	67,286,449	-	67,286,449
Share capital - diluted	71,263,478	-	71,263,478
EPS - basic	(6.73)	-	0.69
EPS - diluted	(6.36)	-	0.65

The impact on (loss)/profit after tax as a result of the policy change has resulted in a change to the Group’s EPS as per above.

The combined effect of the policy leads to improved understandability of the Group’s financial statements, financial performance and financial health.

Significant changes in the current reporting period

The financial position and performance of the Group was particularly affected by the following events and transactions during the reporting period:
- The performance of the Group is closely related to the performance of the industry within which it operates, and specifically digital asset prices. As at the beginning of 2024, Bitcoin and Ethereum were valued at $42.2k and $2.3k, respectively. Over the course of 2024, Bitcoin’s price more than doubled, surpassing $100.0k, driven by the approval of spot Bitcoin ETFs in the US and optimism surrounding pro-crypto policies following Donald Trump’s election victory. Ethereum also saw significant gains, though it lagged behind Bitcoin, partly due to investor preference for Bitcoin ETFs and broader market dynamics. This price action, along with the resultant impact on other alt-coins within the industry, was the main contributing factor to the improved financial performance of the Group during 2024.
- The Group’s overall AUM spread across the various product suites increased from £3.0 billion to
  
  £5.5 billion due to price action, flows and the acquisition of Valkyrie Funds at the start of 2024. This AUM is represented by assets within the Group’s BLOCK index and CoinShares Valkyrie products, in addition to those held on the Group’s balance sheet in association with XBTP and CS Physical as disclosed in notes 11(e) and 11(g). This increase has had a direct impact on management fees in the year (which manifest within the Group’s revenues) which total
  
  £87,206,045 (2023: £42,854,234). (see note 5a)
- Similarly, market conditions have led to an increase in staking rewards, digital asset lending income and other income (which manifest within the Group’s other operating income) totalling a combined £34,090,605 (2023: £23,447,347). (see note 5b)
- On 24 June 2024, the Group announced the successful sale of its FTX claim, held in respect of assets written off during Q4 2022 following the bankruptcy of FTX. The agreement yielded a recovery rate of approximately 116% net of broker fees, resulting in a return of £28,787,099 being recognised as non-recurring income within the year (2023: £nil). (see note 5c)
- On 22 June 2024 the Company fully impaired its investment in FlowBank SA following the receipt of information from the Swiss Financial Market Supervisory Authority (“FINMA”) clarifying that it had opened bankruptcy proceedings against the investee company. This impairment has contributed to a Loss on Associates for the year of £19,813,328 (2023 loss: £10,590,566). (see note 12a)
- The Group elected to change its accounting policy for its digital assets as covered in note 2.
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Operating segment information

The Group comprises three core operating segments from which it earns both revenues/gains and incurs expenses, being:

Asset Management
Capital Markets
Principal Investments

The identification of operating segments is performed by management and reviewed by the Chief Executive, who have identified that such information needs to be reported separately on an ongoing basis to inform decision making and assessment of performance. Each operating segment has its own segment head and identifiable team/resources.

The Group does not monitor its assets and liabilities split by operating segment, but rather on a consolidated basis.

This is the measure reported to the Group’s Chief Executive, being the Group’s chief operating decision maker, for the assessment of segment performance.

There is no geographical split of revenues, gains or other income required in assessing the operating segments of the Group. All operations undertaken by the Group which generate such items are ultimately based in Jersey.

The following is an analysis of the Group’s revenue and results by reportable segment in the year ended 31 December 2024.


	Asset Management £	Capital Markets £	Principal Investments £	Other £	Total £
Revenue	87,206,045	-	126,760	-	87,332,805
Loss on certificate liability	(2,396,252,307)	-	-	-	(2,396,252,307)
Gain on digital assets and financial instruments	2,396,252,307	22,936,286	2,678,531	-	2,421,867,125
Investment losses*	-	-	(20,552,764)	-	(20,552,764)
Other operating income	-	34,090,608	-	-	34,090,608
Total revenue, gains & other income	87,206,045	57,026,894	(17,747,473)	-	126,485,466
Cost of sales	(7,522,442)	(5,793,419)	(63,387)	-	(13,379,248)
Non-recurring income	-	28,787,099	-	-	28,787,099
Gross profit/(loss)	79,683,603	80,020,574	(17,810,860)	-	141,893,317
Net finance costs	-	-	-	(2,379,354)	(2,379,354)
Other admin expenses	(6,781,256)	(3,676,993)	-	(24,317,095)	(34,775,344)
Operating profit/(loss)	72,902,347	76,343,581	(17,810,860)	(26,696,449)	104,738,619

Income tax expense (731,452)

Exchange differences on translation of foreign operations 3,174,923

Total comprehensive income 107,182,090

* Including amounts recognised through OCI

The following is an analysis of the Group’s revenue and results by reportable segment in the year ended 31 December 2023.


	Asset Management £	Capital Markets £	Principal Investments £	Other £	Total £
Revenue	42,954,234	128,487	-	-	43,082,721
Loss on certificate liability	(1,470,485,132)	-	-	-	(1,470,485,132)
Gain on digital assets and financial instruments	1,470,485,132	5,417,551	2,768,694	-	1,478,671,377
Investment gains*	-	-	924,368	-	924,368
Other operating income	-	27,274,329	-	-	27,274,329
Total revenue, gains & other income	42,954,234	32,820,367	3,693,062	-	79,467,663
Cost of sales	(3,203,771)	(2,248,513)	(235,210)	-	(5,687,494)
Gross profit	39,750,463	30,571,854	3,457,852	-	73,780,169
Net finance costs	-		-	(504,978)	(504,978)
Other admin expenses	(4,288,454)	(3,470,721)	-	(18,353,516)	(26,112,691)
Operating profit/(loss)	35,462,009	27,101,133	3,457,852	(18,858,494)	47,162,500

Income tax expense (573,670)

Exchange differences on translation of foreign operations (8,192,795)

Total comprehensive income 38,396,035

* Including amounts recognised through OCI

COINSHARES 2024 ANNUAL REPORT

83 | 145


5. Revenue and other income
(a) Revenue	Notes	2024 £	2023 £
Management fees	(i)	87,206,045	42,954,234
General Partner's Share	(ii)	126,760	128,487
		87,332,805	43,082,721

The Group’s management fee is made up of the following:

2024 £ 2023 £

CoinShares XBT Provider AB 67,098,615 38,815,487

CoinShares Physical 16,703,912 2,741,926

Block Index 1,731,623 1,396,821

CoinShares Valkyrie 1,671,894 -

87,206,045 42,954,234
Income is derived from the General Partner’s share for services provided to CoinShares Fund II LP (‘CSF2LP’) (for which CoinShares GP II Limited (‘CSGP2L’), a subsidiary in the Group, acts as General Partner), which in accordance with the Limited Partnership Agreement is one quarter of two percent of the capital deployed per quarter.

Accounting policies

The Group earns revenue by issuing ETPs which synthetically track the performance of digital assets under various note programmes. The Group earns fee income, which may vary depending on the note programme, based on the market value of the ETP. The Group recognises the fee income as revenue because it arises on a daily basis over the period that the ETP is outstanding.

The XBTP note program fee revenue is recognised on a daily basis, denominated in fiat, by means of a reduction in the liability owing to the ETP holder. Due to the structure of the XBTP ETPs, and the way in which the Group elects to hedge the liability arising from the issuance of these ETPs, the revenue remains held as part of the overall hedging asset balance until such a time that notes are redeemed, at which point the cash is realised. There is no digital asset exposure risk attached to the revenue that remains held within the hedging assets between recognition and redemption.

The CSDSL management fee note program fee revenue is recognised on a daily basis, denominated in digital assets, by means of a reduction in the coin entitlement owing to the ETP holder. For the staking products with no fee, revenue arising from staking is also denominated in digital assets, with a portion of such proceeds owing to noteholders through increasing the coin entitlement. These revenues are converted on a regular basis into fiat in order to mitigate the risk of digital asset price fluctuations impacting upon revenues arising from CSDSL. There is no digital asset exposure risk attached to the revenue that remains held within the hedging assets between recognition and redemption.

The Group also earns revenue from the provision of investment management services. Revenue is recognised when the performance obligation has been satisfied by transferring the promised services to the customer on a straight line basis over the period during which the service is provided.


(b) Other operating income
	2024 £	2023 £
Staking rewards	23,026,213	19,807,025
Lending book interest	7,347,846	1,917,204
Other digital asset income	1,024,369	2,528,537
Other operating income	1,420,090	1,546,459
Fee rebates	1.272,090	1,475,104
	34,090,608	27,274,329

On 6 February 2024, the Group received a notice of acceptance regarding a claim made to FTX in respect of assets held on the exchange at the time of its bankruptcy in 2022. These assets were fully written off by the Group in 2022. The claim was for US Dollars $28,119,093 and a range of digital assets with a value as at the date of bankruptcy of $3,269,019, bringing the total claim value on this basis to

$31,388,112 (£25,492,017).

On 24 June 2024 the Group sold its claim for $36,410,210 (£28,787,099), representing a 116% recovery rate.

Accounting policies

Other operating income relates to income earned that is not revenue. Other operating income is recognised when it is probable that it will be received by the Group.

Digital assets received as a result of staking activities, airdrops and digital asset lending interest are initially recognised within other operating income. Following initial recognition, such digital assets are classified as inventory and valued in accordance with the Group’s policy on digital assets, with unrealised gains/losses being recognised in the statement of comprehensive income.

Material profit or loss items

The Group has identified a number of items which it believes to be material due to the significance of their nature and/or amount. These are listed separately here to provide a better understanding of the performance of the Group.


	Notes	2024 £	2023 £
Management fees	5(a)	87,206,045	42,954,234
Staking rewards	5(b)	23,026,213	19,807,025
Lending book interest	5(b)	7,347,846	1,917,204

Fair value (loss)/gain on investments through profit and loss

12 (387,283) 11,365,752

Impairment/loss on associates 12 (19,813,328) (10,590,566)

Non-recurring income 5(c) 28,787,099 -


7. Other income and expense items
(a) Cost of sales
	Notes	2024 £	2023 £
Trading expenses		3,108,691	1,494,707
Issuer fees		3,182,521	1,148,568
Custody fees		3,738,553	1,397,770
Direct salary costs		1,862,161	1,646,449
Expected credit loss provision	16	1,487,322	-
		13,379,248	5,687,494

Accounting policies

Cost of sales is considered to be the direct costs incurred by the Group in the process of earning revenue, income and gains. Any other costs incurred are recognised through administration expenses.

Breakdown of administration expenses by nature


	2024 £	2023 £
Salary costs	11,662,576	8,289,331
Bonus accrual	6,334,334	2,391,973
Professional fees	2,458,049	2,201,172
Marketing	4,277,708	2,582,142
Legal fees	986,600	765,124
IT expenses	2,140,598	1,928,391
Amortisation	1,567,451	1,563,972
Depreciation of right of use assets	567,224	1,211,439
Depreciation of owned assets	227,166	201,619
Entertainment expense	174,093	107,559
Travel expense	943,922	718,549
Fees payable to the Company’s auditor (current year)	435,535	397,500
Fees payable to the Company’s auditor (prior year)	-	3,500
Other expenses	3,000,086	3,750,420
	34,775,343	26,112,691


2024 £		2023 £
Finance income from financial instruments measured at amortised cost: Interest from bank and broker deposits 6,599,467		4,462,370
Interest from other financial assets measured 42,863		1,934,671
6,642,330		6,397,041
	2024 £	2023 £
Finance costs on financial instruments measured at amortised cost:
Interest on other borrowings	1,209,215	1,130,946
Interest on amounts owed to brokers	7,669,474	5,695,949
Interest on lease liabilities	142,995	75,124
	9,021,684	6,902,019

Finance income and costs

at amortised cost


8. Income tax expense
	2024 £	2023 £
Corporation tax Current tax on results for the year	731,452	573,670
Taxation on ordinary activities	731,452	573,670

The Group is subject to various corporation taxes as noted below. The Company is subject to tax at the rate of 0%.

2024 £ 2023 £

Profit on ordinary activities before income tax expense 105,090,772 47,013,318 Tax calculated at Jersey tax rate of 0% (2023: 0%) - -


2024 £	2023 £
Tax calculated at Jersey tax rate for regulated financial service 55,290	48,596
Tax calculated at Swedish tax rate of 22% (incurred by XBTP) -	17,670
Tax calculated at UK tax rate of 25% (2023: 23.52%) (incurred by 604,963	504,904
Tax calculated at French tax rate of 26.5% (incurred by CSF) 44,493	1,896
Tax calculated at US tax rates (incurred by CoinShares Co., 22,981	604
Tax calculated at Swiss tax rate (incurred by CoinShares 3,725	-
Total tax charge for the year 731,452	573,670

Effects of:

companies of 10% (incurred by CoinShares (Jersey) Limited (‘CSJL’))

CoinShares (UK) Limited (‘CSUKL’) and CSCMUKL)

CoinShares Capital, LLC and CoinShares GP I LP) Switzerland AG)

Taxation for other jurisdictions is calculated at the various rates and laws substantively enacted on as at the reporting date.

Apart from the UK, there have been no changes in tax rates from the prior year. In the UK, the applicable tax rate was amended from 19% to 25% on 1 April 2023. Given that this is over 2 financial years for the Group, a blended tax rate has been calculated using the number of days falling in each tax year for 2023, with the full 25% rate being incurred for 2024.

The current tax liability at the year end is £91,987 (2023: £156,970).

Accounting policies

The taxation charge is based on the profit for the year as adjusted for tax purposes. The Company pays tax at 0%, the standard Jersey tax rate. Entities within the Group pay tax at various rates throughout the jurisdictions, as described above.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in profit and loss because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. In addition, a deferred tax liability is not recognised if the temporary difference arises from the initial recognition of goodwill.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled, or the asset is realised based on tax laws and rates that have been enacted or substantively enacted at the reporting date.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Current and deferred tax are recognised in profit and loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

NUMERICAL INFORMATION - STATEMENT OF FINANCIAL POSITION


9. Digital assets
	Notes	2024 £	2023 £
Non-current digital assets	9(a)	-	1,331,614
Current digital assets held as inventory	9(a)	2,442,813,368	1,896,954,602
Current digital assets held for collateral purposes	9(b)	1,184,392,369	478,895,757
		3,627,205,737	2,377,181,973

Significant judgement - accounting treatment of digital assets

Digital assets held as inventory

There is no specific accounting standard for digital assets, and IFRS guidance indicates that the accounting treatment may vary depending upon the reasons for holding said assets, and the classification of the entity (i.e. as a broker-trader). The directors have determined that the Group and its subsidiaries, excluding CSDSL (see below), qualify as a broker-trader due to the activities undertaken and have therefore concluded the digital assets held qualify for presentation in accordance with IAS 2. This treatment is an area of significant judgement.

Digital assets held for collateral purposes

The classification of intangible assets held for collateral purposes are designated as hedging instruments within fair value hedge accounting relationships, as defined by IFRS 9. These assets offset the exposure to fair value changes in liabilities associated ETPs issued by the Group.

Accounting policies

During the year the Group elected to change its accounting policy for the recognition and subsequent measurement of its digital assets to either IAS 2 or IFRS 9. Please refer to note 2 for how the Group applies these standards to its classes of digital assets, and the impact of this change on the 2023 financial statements.

Digital assets held as inventory

Digital assets held as inventory are classified under IAS 2 as ‘Inventories’. These assets are held for sale in the ordinary course of business or for trading purposes and are measured at fair value less costs to sell. Where applicable, costs to sell are deemed negligible for digital assets that are freely tradeable. For digital assets that do not meet these criteria, a discount is applied to reflect these costs.

Recognition

Digital assets are classified as inventory when the assets are held for sale in the ordinary course of business or for trading purposes.

These digital assets are recognised as inventory when the Group obtains all risks and rewards of ownership either through acquisition or transfer. Digital assets held as inventory are initially recognised at the cost of acquisition at the point the risks and rewards are obtained.

01

02

03

04

05

06

07

08

Subsequent measurement

Inventory is measured at the lower of cost and net realisable value, unless the inventory is held by a commodity-broker-trader who measures the inventory at fair value less costs to sell. A broker-trader is one who buys and sells assets for others or on their own account with the purpose of selling in the near future and generating a profit from fluctuations in price or trading margin. The directors deem the Group and its subsidiaries, excluding CSDSL (see below), meet the definition of a broker-trader.

The Group values its digital assets held as inventory as follows:

Digital assets which are freely tradeable and for which there is an active market are valued using unadjusted quoted prices, or an average of unadjusted quoted prices, taken from active markets. As such, these assets are classified as Level 1 in the fair value hierarchy.

Digital assets that are subject to lock-up and not freely tradeable are valued using quoted prices discounted for a lack of liquidity. As such these digital assets have been classified as Level 2 in the fair value hierarchy. At the point when such digital assets become freely tradeable, they are reclassified as Level 1 in the fair value hierarchy and accounted for in line with other digital assets.

In certain cases, the inputs used to measure fair value fall into different levels of the fair value hierarchy. In such cases, an asset’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The directors’ assessment of the significance of a particular input to the fair value measurement in its entirety requires judgement and it considers factors specific to the asset.

Bitcoin and Ethereum are valued by the Group based on the average price of the three most liquid exchanges as defined in the XBTP prospectus at the date of the valuation. The valuation takes place daily at 08:00-12:00 (UTC) for Bitcoin, where the value is calculated as the unweighted average price between the bitcoin exchanges of the weighted average price for the period of each underlying exchange (separately). For Ethereum the valuation takes place daily at 16:00 (UTC). Although these valuations are ultimately derived from a number of sources, the sources themselves are unadjusted and would each represent a Level 1 classification within the fair value hierarchy. As such, these holdings have been classified as Level 1. Should the average price of the three exchanges utilised show a material difference to any of the prices from an individual exchange, the classification of these assets as Level 1 would be reassessed.

Other digital assets that are freely tradeable are valued using unadjusted quoted prices taken from active markets. As such these digital assets have also been classified as Level 1 in the fair value hierarchy.

All gains and or losses are recognised in the statement of comprehensive income. Please refer to note 25 for further consideration of the fair value measurement basis.

Derecognition

Digital assets are derecognised either at the point the risks and rewards of ownership are transferred or sold for fiat currency. All gains or losses on derecognition are recognised in the statement of comprehensive income.
Digital assets held for collateral purposes

Digital assets that are not classified as inventory under IAS 2 remain classified as intangible assets under IAS 38. However (as outlined in note 2) a hedging relationship has been identified in respect of these specific assets, in accordance with the requirements of IFRS 9. These assets are used to offset the exposure to fair value changes in its corresponding certificate liabilities issued by the Group. Please refer to note 10 for details on the hedging activities undertaken by the Group.

The Group performs both prospective and retrospective effectiveness testing at each reporting date to confirm that the hedge continues to be highly effective, ensuring that fair value changes in the hedging instrument and hedged item remain offset. The Group maintains and requires a 100% threshold for effectiveness testing, in accordance with requirements of the prospectus under which the Groups certificates are issued and governed.

Any hedge ineffectiveness, calculated as the difference between the fair value movement in the digital assets and the offsetting movement in the hedged liabilities, is recorded within the statement of comprehensive income.

Recognition

Digital assets are classified as collateral when a contractual obligation exits between the Group and a third party investor, with there being a corresponding hedging relationship.

These digital assets are recognised as collateral when the Group obtains all risks and rewards of ownership at the point a certificate liability is created. Digital assets held as collateral are initially recognised at fair value at the point the risks and rewards are obtained.

Subsequent measurement

The digital assets held to collateralise a collective of exchange traded products, see note 11(e), are subsequently measured using reference indices as defined in the relevant prospectus for such products. The digital assets are valued using the same methodology, relying on an unadjusted index price.

These digital assets are freely tradeable with active markets and are valued using unadjusted quoted prices, or an average of unadjusted quoted prices, taken from active markets. As such, these digital assets are classified as Level 1 in the fair value hierarchy.

All gains and or losses are recognised in the statement of comprehensive income. Please refer to note 25 for further consideration of the fair value measurement basis.

Derecognition

Digital assets are derecognised either at the point the risks and rewards of ownership are transferred, redeemed or when the present obligation no longer exists. All gains or losses on derecognition are recognised in the statement of comprehensive income.


(a) Digital assets held as inventory
	2024 £	2023 £
Bitcoin	1,355,455,409	1,070,741,468
Ethereum	883,779,185	725,553,080
Other digital assets	203,578,774	101,991,668
	2,442,813,368	1,898,286,216
Of which:	2024 £	2023 £
Non-current digital assets held as inventory	-	1,331,614
Current digital assets held as inventory	2,442,813,368	1,896,954,602
	2,442,813,368	1,898,286,216

Measurement of digital assets held as inventory

Digital assets that are freely tradeable are measured at fair value and have been classified as Level 1 in accordance with the IFRS fair value hierarchy, refer to note 25. Price movements are recognised at fair value through profit and loss, as outlined below within the digital asset accounting policies section of this note. A reconciliation of movements in digital assets is also shown below.

The Group has classed digital assets under the fair value hierarchy as follows.


	2024 £	2023 £
Level 1 digital assets	2,442,813,368	1,896,954,602
Level 2 digital assets	-	1,331,614
	2,442,813,368	1,898,286,216

The Group transferred £1,331,614 of digital assets from Level 2 to Level 1 during the year.

Reconciliation of level 1 digital assets held as inventory


07		2024 £	2023 £
08	Opening position	1,896,954,602	750,991,303
	(Sales)/net purchases of digital assets	(850,847,105)	87,654,988

Fair value gains/(losses) on digital assets through profit and loss

Translation of holdings in USD denominated subsidiaries

1,345,171,305 1,103,014,326

51,534,567 (44,706,015)

Closing position 2,442,813,368 1,896,954,602

Purpose of holdings

The digital assets are held to trade in accordance with the Collateral Management Agreement in respect of the Group’s XBTP product suite, and other investments with a view to sell and generate realised gains. Of the £2,442,813,368 (2023: £1,896,954,602) of assets held, £35,662,397 (2023:

£31,122,973) do not form part of the collateral obligation of XBTP product suite.

Location of assets

The majority of the Group’s digital assets are held with regulated digital asset custodians or staked through certain providers. In the case of the latter, the private keys for these holdings are retained by the Group which mitigates counterparty risk. In order to mitigate the potential for increased counterparty risk arising from assets held on exchange, the Group relies on a range of monitoring procedures which are detailed in note 16(b).

As at 31 December 2024, the balance of £125,138,842 (2023: £103,937,400) was held at 15 (2023: 14) locations. The level of overall current assets held on exchange (represented by both digital assets and also cash balances) as at 31 December 2024 was 4% (2023: 4%).


		2024 £	2023 £
By Venue
Custodian	2,270,216,831	1,200,056,373
Custody Platform	42,040,189	590,266,296
Exchange	125,671,376	103,937,400
Local Cold Storage	4,689,265	4,026,147
Other	195,706	-
	2,442,813,368	1,898,286,216
01
	(b) Digital assets held for collateral purposes
02		2024 £	2023 £
03	Bitcoin	635,066,816	302,110,474
04	Ethereum	229,977,249	91,417,374
	Solana	107,049,497	31,136,158

Other digital assets 212,298,807 54,231,752

1,184,392,369 478,895,757

Measurement of digital assets


Reconciliation of digital assets held for collateral purposes
	2024 £	2023 £
Opening position	478,895,757	117,931,214
Net purchases/(sales) of digital assets	131,278,120	177,301,597
Fair value gains/(losses) on digital assets through profit and loss	574,218,492	183,662,946
Closing position	1,184,392,369	478,895,757

Purpose of holdings

The digital assets are held to collateralise the exchange traded products issued by CSDSL. The Group performs both prospective and retrospective effectiveness testing at each reporting date to confirm that the hedge continues to be highly effective, ensuring that fair value changes in the hedging instrument and hedged item remain offset. The Group maintains and requires a 100% threshold for effectiveness testing, in accordance with the requirements of the prospectus under which the Groups certificates are issued and governed. This is shown in note 10.

The value of the ETP’s and digital assets held for collateral purposes are linked to the value of the underlying digital assets on which the ETP or digital asset held as collateral is denominated. The price of digital assets are volatile and may be affected by a variety of factors. Should demand for digital asset decrease or increase significantly then its value could fluctuate sharply and permanently which, in turn, would directly impact the price of the ETPs or value of the digital assets held as collateral.

In the absence of a fair value hedging arrangement, there is a risk that the Company would be directly exposed to adverse changes in the fair value of the ETPs and digital assets held as collateral and, by association, the underlying digital assets on which they are denominated.

The Group holds digital assets as hedged items in line with the requirements of the CSDSL prospectus, in order to hedge the risk of exposure to fair value changes in the ETPs as hedging instruments. The fair value hedging relationship between the hedged items and hedging instruments is in place to mitigate the risk of adverse exposure to digital asset price movements to the Group.

Location of assets

The Group’s digital assets are held with regulated digital asset custodians. In order to mitigate the potential for increased counterparty risk arising from assets held on exchange, the Group relies on a range of monitoring procedures which are detailed in note 16.

Hedging Activities

The Group applies hedge accounting in accordance with IFRS 9 – Financial Instruments to manage its exposure to changes in the fair value of its digital asset holdings. The Group designates ETPs referencing digital assets as hedging instruments in a fair value hedge relationship. These hedging arrangements mitigate fluctuations in the fair value of the hedged items, which arise from changes in digital asset prices.

The Group’s hedging strategy is designed to offset fair value movements in its digital asset holdings using a 1:1 hedge ratio, ensuring a high degree of correlation between the hedged item and hedging instrument. The ETPs issued by the Group serve as designated fair value hedges, with their value moving in direct alignment with the corresponding digital asset holdings.

In addition to fair value changes, the hedged items and hedging instruments are subject to periodic additions, driven by new issuances of ETPs and changes in the Group’s underlying digital asset positions. These additions are factored into the hedge accounting framework to ensure continuous alignment and effectiveness.

Given that the hedge is governed by the terms set out in the various ETP prospectuses issued by the Group, it operates at 100% effectiveness, with no anticipated hedge ineffectiveness.

Hedge effectiveness is assessed at inception and on an ongoing basis to ensure that:

An economic relationship exists between the digital asset holdings and the corresponding ETPs.
The hedge remains fully effective, with no material basis risk.

The hedge ratio is adjusted dynamically to reflect additions to both the hedged items and the hedging instruments, ensuring continuous alignment.

The carrying amounts and fair value changes of the hedged items and hedging instruments, including additions during the year, are as follows:

Reconciliation of hedged items

Notes 2024 £ 2023 £


	Opening carrying amount of hedged items		478,895,757	117,931,214
03	Net additions during the year		131,278,120	177,301,597
	Change in fair value of hedged items		574,218,492	183,662,946
04	Closing carrying amount of hedged digital asset holdings	9(b)	1,184,392,369	478,895,757

Reconciliation of hedging instruments


Notes	2024 £	2023 £
Opening carrying amount of hedging instruments	478,895,757	117,931,214
Net additions during the year	131,278,120	177,301,597
Change in fair value of hedging instruments	574,218,492	183,662,946
Closing carrying amount of hedging 11(e)	1,184,392,369	478,895,757

instruments

Hedge ineffectiveness in Statement of

Comprehensive Income - -

Since the hedge relationship is dynamically managed to reflect additions to both the hedged items and hedging instruments, all fair value changes and volume adjustments are fully offset, ensuring that no hedge ineffectiveness arises.

Additions to Hedged Items: The Group increases its holdings of digital assets in response to new inflows into ETPs. These additions are incorporated into the hedge accounting framework at their respective fair values on the date of recognition.

Additions to Hedging Instruments: Corresponding to the inflow of new capital, the Group issues additional ETPs, which are automatically designated as part of the hedge relationship.

Financial assets and liabilities

The table below sets out the financial assets and liabilities held by the Group.


	Notes	2024 £	2023 £
Current financial assets Cash and cash equivalents	11(c)	19,859,572	25,507,944
Other current assets	11(b)	1,113,357,091	266,093,775
Trade and other receivables	11(a)	2,977,315	2,241,203
		1,136,193,978	293,842,922
	Notes	2024 £	2023 £
Non-current financial assets Investments	12	19,998,654	25,110,879
Trade and other receivables	11(a)	1,256,818	328,614
Other non-current assets	11(b)	894,377	2,211,742
		22,149,849	27,651,235
	Notes	2024 £	2023 £
Current financial liabilities Certificate liability	11(e)	(4,171,982,360)	(2,351,475,523)
Amounts due to brokers	11(d)	(79,011,258)	(669,402)
Trade and other payables	11(f)	(10,523,355)	(5,612,218)
Other current liabilities	11(g)	(201,457,063)	(108,940,878)
		(4,462,974,036)	(2,466,698,021)
	Notes	2024 £	2023 £
Non-current financial liabilities
Non-current loans	11(g)	(19,654,267)	(23,145,127)
		(19,654,267)	(23,145,127)

Movements in financial assets and financial liabilities

The financial assets and liabilities held by the Group are subject to price movements which result in operating gains or losses. These movements are predominantly in relation to the digital asset ETPs issued by third parties and held by the Group as part of the XBTP hedging assets (note 11(b)).

The table below sets out the other operating gains/(losses) through profit and loss arising from these movements.


	2024 £	2023 £
Gain on digital asset ETPs	391,262,500	135,959,647
Gain on digital asset payables/receivables	137,103,619	35,568,047
(Loss)/gain on derivatives	(42,593,296)	17,180,194
Gain of foreign exchange	17,239,828	3,156,214
(Loss)/gain on other operating activities	(535,325)	130,003
	502,477,326	191,994,105

Accounting policies

The Group has determined that the accounting policies for certain of the Group’s ETPs, and other derivative contracts, are the same as they would be for an equivalent contract settled in cash and meeting the definition of a financial instrument. These contracts are analysed as such within the notes to the financial statements.

Financial assets

The accounting policy for non-current asset investments where the Group does not have control or significant influence, which are financial assets accounted for under IFRS 9.

Initial recognition and measurement

The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Group’s business model for managing them.

Subsequent measurement

Subsequently the Group’s financial assets are classified into several categories:

Financial assets measured at amortised cost;
Financial assets measured at fair value through profit or loss; and
Financial assets measured at fair value through other comprehensive income.

Financial assets at amortised cost and effective interest model

The effective interest method is a method of calculating the amortised cost of a debt instrument and allocating interest income over the relevant period.

For financial assets, the effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) excluding expected credit losses, through the expected life of the debt instrument, or, where appropriate, a shorter period, to the gross carrying amount of the debt instrument on initial recognition.

The amortised cost of a financial asset is the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount, adjusted for any loss allowance. The gross carrying amount of a financial asset is the amortised cost of a financial asset before adjusting for any loss allowance.

Financial assets at fair value through profit or loss

Financial assets classified as current assets are measured at fair value through profit or loss. The fair value basis is measured using the fair value hierarchy.

Investments valued through Other Comprehensive Income

Certain balances which are classified as investments held by the Group represent carried interest receivables on funds. Due to the lack of clarity around the timing of ultimate receipt of these amounts, these investments are revalued through other comprehensive income until such a time when the receivable is realised.

01

02

03

04

05

06

07

08

Impairment of financial assets measured at amortised cost

An impairment loss is recognised for the expected credit losses on financial assets when there is an increased probability that the counterparty will be unable to settle an instrument’s contractual cash flows on the contractual due dates, a reduction in the amounts expected to be recovered, or both.

The probability of default and expected amounts recoverable are assessed using reasonable and supportable past and forward-looking information that is available without undue cost or effort. The expected credit loss is a probability-weighted amount determined from a range of outcomes and takes into account the time value of money.

The measurement of impairment losses depends on whether the financial asset is ‘performing’, ‘underperforming’ or ‘non-performing’ based on the Group’s assessment of increases in the credit risk of the financial asset since its initial recognition and any events that have occurred before the year- end which have a detrimental impact on cash flows. The financial asset moves from ‘performing’ to ‘underperforming’ when the increase in credit risk since initial recognition becomes significant.

In assessing whether credit risk has increased significantly, the Group compares the risk of default at the year-end with the risk of a default when the financial asset was originally recognised using reasonable and supportable past and forward-looking information that is available without undue cost. The risk of a default occurring takes into consideration default events that are possible within 12 months of the year-end (‘the 12-month expected credit losses’) for ‘performing’ financial assets, and all possible default events over the expected life of those debtors (‘the lifetime expected credit losses’) for ‘underperforming’ financial assets.

Impairment losses and any subsequent reversals of impairment losses are adjusted against the carrying amount of the financial asset and are recognised in profit and loss.

For trade receivables, expected credit losses are measured by applying a simplified method using a provision matrix. The expected loss rate comprises the risk of a default occurring and the expected cash flows on a default based on the ageing of the debtor. The risk of a default occurring always takes into consideration all possible default events over the expected life of those debtors. Different provision rates and periods are used based on groupings of historic credit loss experience by product type, customer type and location.

Derecognition of financial assets

Financial assets, or a part thereof, are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the Group transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

When there is no reasonable expectation of recovering a financial asset it is derecognised. The gain or loss on derecognition is recognised in profit and loss.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deduction of all its liabilities.

Financial liabilities are initially recognised at fair value, which is normally equivalent to transaction price, less transaction costs.

01

02

03

04

05

06

07

08

Subsequent measurement

Subsequently the Group’s financial liabilities are classified into two categories:
Financial liabilities measured at amortised cost; and
Financial liabilities measured at fair value through profit or loss (‘FVTPL’).

Financial liabilities at amortised cost

Financial liabilities that are not (i) held for trading, or (ii) designated as at FVTPL, are measured subsequently at amortised cost using the effective interest method.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the amortised cost of a financial liability.

Financial liabilities at amortised cost held by the Group include loans payable with contractual cashflows and lease liabilities.

Financial liabilities at fair value through profit or loss

Financial liabilities not held at amortised cost and whose business objectives are not achieved through trading or contractual cashflows are measured at fair value through profit or loss.

Financial liabilities at fair value through profit or loss held by the Group include amounts due to the holders of Group issued ETPs.

Liabilities arising in connection with ETPs issued by the Group referencing the performance of digital assets are measured at fair value through profit or loss. Their fair value is a function of the unadjusted quoted price of the digital asset underlying the ETP, less any accumulated management fees, measured as described in note 25.

The fair value basis is consistent with the measurement of the underlying digital assets which are considered Level 1 under the fair value hierarchy.

Derecognition of financial liabilities

Financial liabilities (or part thereof) are derecognised when, and only when, the Group’s obligations are discharged, cancelled, or they expire. Any difference between the carrying amount of a financial liability (or part thereof) that is derecognised and the consideration paid is recognised in profit or loss.

Significant judgements

Valuation of digital asset ETPs and Funds

The Group uses an adjusted (level 2) valuation for most of its ETP assets. The principal reason for the use of a level 2 valuation is due to these assets being (i) contractually redeemable for the underlying digital asset and/or ii) held to hedge the certificates issued by XBTP. When it comes to valuing the underlying holdings, the same approach is taken with the Group’s direct digital asset holdings which are classified as level 1. The Group has therefore sought to apply a consistent methodology to the valuation of these, and other assets, such as physical and derivative digital assets used in the hedge. This consistent approach ensures that assets ultimately used in the hedge are valued on the same basis and importantly at the same time as their respective liabilities.


(a) Trade receivables
	2024 £	2023 £
Non-current
Deposits paid	236,652	305,335
Deferred tax	-	23,279
Investment amounts receivable	820,062	-
Other non-current assets	200,104	-
Total non-current	1,256,818	328,614

Current
Accounts receivable	1,695,020	1,323,766
Amounts owed by related parties	32,396	33,875
Deposits paid	34,287	118,944
Prepayments	1,113,634	591,433
VAT receivable	101,978	173,185
Total current	2,977,315	2,241,203
Total trade receivables	4,234,133	2,569,817

Expected credit losses

Credit risk is considered as part of the risk disclosures in note 16(b). Management has undertaken a review of the credit loss and calculated that the risk of credit loss to be minimal. When calculating the value of this, the amount was considered insignificant to the Group.

Management regularly review this position to ensure that this is reasonable for the Group.


(b) Other assets
	Notes	2024 £	2023 £
Non-current
Loans receivable	(i)	894,377	1,469,196
Other assets		-	742,546
Total non-current		894,377	2,211,742

Current
Digital asset ETPs	(iii)	952,665,878	211,384,245
Other assets	(ii)	160,691,213	54,709,530
Total current		1,113,357,091	266,093,775
Total other assets		1,114,251,468	268,305,517

This balance predominantly comprises convertible loan notes issued to Impervious and Syndica for a principal amount of $500,000 and $300,000 respectively.
The majority of current other assets represent digital asset lending balances to small number of counterparties totalling £156,898,249 (2023: £49,146,747). Expected credit loss in relation to these lending balances is considered as part of the risk disclosures in note 16.

01

02

03

04

05

06

07

08
The table below shows a reconciliation between the opening and closing position of the Group’s digital asset ETPs.


	2024 £
Opening position	211,384,245
Net additions and transfers	830,259,368
Net disposals and transfers	(507,923,634)
Net movement	322,335,734
Realised gain	40,841,418
Unrealised gain	360,910,765
Net gain	401,752,183
Exchange differences	17,193,717
Closing position	952,665,878

Digital asset ETPs held as at year end totalled £952,665,878 (2023: £211,384,245). These holdings are used to provide exposure to digital assets and are held as a part of the Group’s collateral management obligations. Of this balance, £116,210,271 is held as collateral with Reyl Bank (see note 11(g)) in respect of a loan facility. While the majority of the loan balance is non-current, repayment can be made at the discretion of the Group and the collateral recalled, hence its classification as a current asset.


(c) Cash and cash equivalents
	Notes	2024 £	2023 £
Cash at bank		5,764,446	6,660,753
Amounts due from brokers	(i)	5,743,370	16,270,974
Amounts due from exchanges		8,351,756	2,576,217
Total cash and cash equivalents		19,859,572	25,507,944
		2024 £	2023 £
(i) Due from brokers Interactive Brokers		3,348,014	11,952,502
Marex Capital		2,381,538	4,305,194
Mangold		13,818	13,278
Total due from brokers		5.743,370	16,270,974

Amounts due from/to brokers and amounts due from exchanges represent cash held by/payable to brokers and exchanges and are classified as cash and cash equivalents. Amounts payable from/to brokers accrue interest. The Company has the right and ability to settle its obligations with brokers on a net basis.

Accounting policies

Cash at bank

Cash at bank consists of balances with banks and are classified as basic financial assets with a maturity of three months or less from inception.

Cash deposits with financial institutions are repayable without penalty on notice of not more than 24 hours.

Amounts due from brokers

Amounts due from/to brokers represent cash receivable from/payable to brokerage firms, arising due to the ongoing trading activities of the Group, and are classified as cash equivalents.

Amounts due from exchanges

Amounts due from exchanges represents cash receivables from/payable to exchanges in relation to digital assets transactions and are classified as basic financial assets/liabilities.

Other cash equivalents

Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and that are subject to an insignificant risk of changes in value.

Amounts due to brokers

2024 £ 2023 £

Marex Prime Services (79,011,258) (669,402)

Total due to brokers (79,011,258) (669,402)


	2024 £	2023 £
Coinshares Physical
CoinShares Physical - Bitcoin	627,584,222	301,998,264
CoinShares Physical - Staked Ethereum / Ethereum	226,743,567	91,269,305
CoinShares Physical - Staked Solana	105,548,344	31,071,177
CoinShares Physical - Other	224,516,236	54,557,011
Total CoinShares Physical certificate liabilities	1,184,392,369	478,895,757


(e) Certificate liability
	2024 Number	2023 Number	2024 £	2023 £
Certificate type
Bitcoin Tracker One	2,713,492	3,468,999	966,606,752	537,280,975
Bitcoin Tracker Euro	332,913	432,477	1,182,787,868	666,988,025
Ether Tracker One	12,287,008	15,309,343	308,359,910	255,254,209
Ether Tracker Euro	2,119,967	2,487,963	529,835,461	413,056,557
CoinShares Physical Bitcoin 8,555,086		9,339,130	627,584,222	301,998,264
CoinShares Physical Ethereum	2,803,190	1,718,953	226,743,567	91,269,305
CoinShares Physical Litecoin	607,000	401,500	9,482,593	4,470,073
CoinShares Physical XRP	1,831,780	874,300	117,143,738	16,404,468
CoinShares Physical Staked Polkadot	1,698,100	557,500	10,677,276	4,084,656
CoinShares Physical Staked Tezos	839,000	564,000	4,871,644	2,415,298
CoinShares Physical Staked Solana	6,181,100	3,652,100	105,548,344	31,071,177
CoinShares Physical Chainlink	8,021,000	3,111,000	12,808,282	3,652,266
CoinShares Physical Uniswap	6,190,000	2,310,000	6,480,074	1,336,096
CoinShares Physical Staked Cardano	34,472,500	22,705,000	25,574,702	11,272,945
CoinShares Physical Staked Cosmos	694,500	374,500	2,018,473	1,724,979
CoinShares Physical Staked Polygon	1,443,500	568,500	5,916,163	4,758,310
CoinShares Physical Staked Algorand	5,026,000	2,161,000	14,655,197	3,939,541
CoinShares Physical Top 10 Crypto Market	114,000	25,000	3,088,774	346,970
CoinShares Physical Smart Contract Platform	121,000	10,000	2,741,429	151,409
CoinShares Finanzen.net Top 10 Crypto ETP	730,000	-	9,057,891	-
			4,171,982,360	2,351,475,523


	2024 £	2023 £
CoinShares XBT Provider
CoinShares XBT Provider - Bitcoin	2,149,394,620	1,204,269,000
CoinShares XBT Provider - Ethereum	838,195,371	1,872,579,766
Total CoinShares XBT Provider certificate liabilities	2,987,589,991	1,872,579,766

The certificates are held at fair value through profit or loss. The fair value of the certificates are calculated with reference to market prices as defined in the relevant prospectus.


Reconciliation of certificates
	2024 £	2023 £
At 31 December 2023	2,351,475,523	986,707,490
Movement from net redemption	(491,942,943)	(64,159,686)
Management fee	(83,802,527)	(41,557,413)
Movement on certificate liability	2,396,252,307	1,470,485,132
At 31 December 2024	4,171,982,360	2,351,475,523
Significant judgement

Accounting treatment of ETPs

The Group has determined that the accounting policies for certain of the Group ETPs, and other derivative contracts, are the same as they would be for an equivalent contract settled in cash and meet the definition of a financial instrument. These contracts are analysed and such within the notes to the financial statements.


(f) Trade and other payables
	2024 £	2023 £
Accounts payable	1,097,923	1,004,360
Accrued liabilities	9,425,503	4,607,858
Total trade payables	10,523,355	5,612,218


(g) Other current liabilities and loans
	Notes	2024 £	2023 £
Reyl loan	(i)	19,682,176	23,145,127
Solana seed	(ii)	188,357,488	92,117,829
OTC Trades	(iii)	9,588,755	7,761,682
Algorand Foundation	(iv)	-	2,734,526
Other borrowings		255,838	54,306
Amounts due to exchange	(v)	1,659,389	5,335,392
Fund liabilities to external investors	(vi)	1,567,353	937,143
Cash overdraft		331	-
		221,111,330	132,086,005
Payable within one year		201,457,063	108,940,878
Payable in more than one year		19,654,267	23,145,127

The Group has a loan balance to Reyl Bank in the sum of CHF 22,266,000 (£19,654,267) (2023: CHF 24,740,000) (£23,097,199)) plus accrued interest of CHF 31,618 (£25,203) (2023: CHF 51,336

(£40,323)). The loan bears interest at a rate equal to the interest base rate SARON 1 to 3 months, that cannot fall below 0% per annum, plus a credit margin of 2.25% and internal costs of the Bank for making the liquidity available to the Group during the entire loan duration with a minimum of 0.20% per annum. The ultimate maturity date of the loan is 10 March 2027.

The Group holds assets with Reyl Bank in the form of publicly traded ETP certificates. These amounted to a market value as at 31 December 2024 of £116,210,271, a portion of which will stay with Reyl Bank until the loan balance has been fully settled.

During the year, 10% (equating to CHF 2,474,000) of the principal loan balance was repaid.
The balance represents the value of 10,000,000 certificates in CoinShares Physical Staked Solana which are held by the Group on behalf of a third party who contributed 1,000,000 SOL of seed capital to the product. This amount is hedged in full by physical Solana within CSDSL.
The balance represents the sterling equivalent value of OTC liabilities in the course of settlement at the balance sheet date. This balance is hedged by digital assets held.
The balance represents the value of 1,500,000 certificates in CoinShares Physical Staked Algorand which are held by the Group on behalf of a third party, who contributed 15,000,000 ALGO of seed capital to the product. This balance is hedged by digital assets held.
Amounts due to exchanges balances due to exchanges as at year end that are settled in digital assets.
Fund liabilities due to external investors arise from investments made by third parties into the Group’s Bitcoin and Ethereum Integrated Strategies Funds (‘BIS’ and ‘EIS’ respectively) which currently are consolidated within the Group until such a time as they garner sufficient inflow to trigger deconsolidation.

Other Financial assets- Investments


Investments in Joint Ventures & Associates £	Investments in Listed Equities £	Other Investments Through P&L £	Other Investments Through OCI £	Total £
At 31 December 2023 19,813,328	611	19,681,201	5,429,067	44,924,207
Additions -	-	659,011	-	659,011
Distribution / disposal -	-	(4,872,799)	(195,425)	(5,068,224)
Fair value gain through - profit and loss	-	(387,283)	(352,152)	(739,435)
Impairment of (19,813,328)	-	-	-	(19,813,328)
Exchange differences -	-	36,423	-	36,423
At 31 December 2024 -	611	15,116,553	4,881,490	19,998,654

associate

through profit and loss


	31 December	Additions/	Investment	Transfers	31 December
2023	(Disposals)	Gain/(Loss)	between	2024
£	£	£	levels £	£
Level 1 Investments	611	-	-	-	611
Level 2 Investments	5,429,067	(195,425)	(352,152)	-	4,881,490
Level 3 Investments	19,681,201	(4,213,789)	(350,859)	-	15,116,554
Total investments	25,110,879	(4,409,214)	(703,011)	-	19,998,654
held at fair value
Associates	19,813,328	-	(19,813,328)	- -
Total investments
valued using the	19,813,328	-	(19,813,328)	- -
equity method
Total investments	44,924,207	(4,409,214)	(20,516,339)	- 19,998,654

For the balance of £15,116,554 which represents investments classified as Level 3 within the fair value hierarchy, the following table summarises the quantitative information about the material investment and its significant inputs used.

Description Fair value

Unobservable

inputs

Input amount

Input range

Unlisted equities valued based on performance

2,802,818 EBITDA multiple 21.0 5 - 30

Relationship between unobservable inputs and fair value

Decreasing the inputs to the lowest points of the given ranges would decrease fair value as at 31 December 2024 by £2,135,321.

Increasing the inputs to the highest point of the given ranges would increase the fair value as at 31 December 2024 by £1,202,161.

Description Fair value

Unobservable

inputs

Input amount

Input range

Unlisted equities held at price 11,017,996 of recent investment

Discount factor on price of recent

investment

0% -20% to 0%

Relationship between unobservable inputs and fair value

Decreasing the inputs to the lowest points of the given ranges would decrease fair value as at 31 December 2024 by £2,203,599.

Increasing the inputs to the highest point of the given ranges would result in no change to the fair value as at 31 December 2024.

Increasing all inputs to the highest point of the given ranges would result in an increase in the value of investments classified as Level 3 of £1,202,161.

Decreasing all inputs to the highest point of the given ranges would result in a decrease in the value of investments classified as Level 3 of £4,338,920.

Accounting policies

In the financial statements of the Group, investments in listed equities and other investments are held at fair value through profit or loss except where the directors have made an irrevocable claim to designate fair value movements through other comprehensive income.

Simple Agreements for Future Tokens/Equity

Such agreements outline the delivery of digital assets (referred to as Tokens (‘SAFTs’), equity (‘SAFEs’) or a combination thereof (‘SAFTEs’)) to the Group either on a specified date or following the occurrence of a defined event. These agreements are initially recognised at fair value as of the date they are entered. SAFTs are classified as digital asset receivables and are subsequently measured at fair value as described in note 9. SAFEs are classified as financial assets through profit and loss, and further detail on the Group’s fair value accounting policy can be found in note 25. In cases where the Group holds SAFEs with hybrid elements, these are evaluated separately based on their risks and characteristics.

These agreements are monitored on an ongoing basis. In the event that the ultimate delivery of the tokens/equity is called into question, or the likely value of the holding is deemed to be lower than initial cost, the receivable will be impaired with such charge being taken through profit and loss.

Key accounting estimate and assumption

Valuation of investments

The fair value of financial instruments, including investments, that are not traded in an active market is determined using valuation techniques. The Group uses its judgement to select a variety of methods and make assumptions that are mainly based on market conditions existing at the end of each reporting period.

(a) Investments in associates

The Group’s investments in associates which form part of the Group as at 31 December 2024 are as follows:

Name Investee

Relationship

Ownership Date of Initial Investment

FlowB Holding Switzerland SA Associate 28.31% 02/10/2021

The Group held a 28.31% (2023: 26.75%) position in FlowB Holding Switzerland SA (‘FlowBank’) during the year. Following the bankruptcy proceedings of FlowBank, which was instructed by Finma in Switzerland the Group fully impaired the investment of £19,755,297 through the statement of comprehensive income.

Accounting policies

An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.

In the Group consolidated financial statements the results and assets and liabilities of associates or joint ventures are incorporated using the equity method of accounting, unless the investee is held indirectly through a venture capitalist organisation in which case the investment is measured at fair value through profit or loss.

Under the equity method, an investment in an associate or a joint venture is recognised initially in the consolidated statement of financial position at cost and adjusted thereafter to recognise the Group’s share of the profit or loss and other comprehensive income of the associate or joint venture. When the Group’s share of losses of an associate or a joint venture exceeds the Group’s interest in that associate or joint venture, the Group discontinues recognising its share of further losses. Additional losses are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate or joint venture.

The requirements of IAS 36 are applied to determine whether it is necessary to recognise any impairment loss with respect to the Group’s investment in an associate or a joint venture accounted for under the equity method. When necessary, the entire carrying amount of the investment (including goodwill) is tested for impairment in accordance with IAS 36 as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs of disposal) with its carrying amount. Any impairment loss recognised is not allocated to any asset, including goodwill that forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognised in accordance with IAS 36 to the extent that the recoverable amount of the investment subsequently increases.

Non-financial assets and liabilities


(a) Property, plant and equipment
	Right-of-use property assets £	Furniture and Fittings £	Office Equipment £	Total £
Cost
At 31 December 2023	3,008,294	691,938	550,076	4,250,308
Additions	-	106,107	73,195	179,302
Disposals	-	(58,623)	-	(58,623)
Exchange differences	-	350	(286)	63
At 31 December 2024	3,008,294	739,772	622,985	4,371,051
Accumulated depreciation
At 31 December 2023	265,120	571,008	348,628	1,184,756
Charge for the year	567,224	103,046	124,120	794,390
Disposals	-	(14,187)	-	(14,187)
Exchange differences	-	244	(296)	(52)
At 31 December 2024	832,344	660,111	472,452	1,964,907
Net book value
At 31 December 2024	2,175,950	79,661	150,533	2,406,144
At 31 December 2023	2,743,174	120,930	201,448	3,065,552

Accounting policies

Assets are initially recognised at cost and subsequently measured at cost, net of depreciation and any impairment losses. Cost includes the original purchase price plus costs directly attributable to bringing the asset to its working condition for its intended use.

Subsequent expenditure relating to an item of property, plant and equipment that has already been recognised is added to the carrying amount of the asset only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repair and maintenance expenses are recognised in profit and loss as incurred.

A right-of-use asset is recognised at commencement of the lease and initially measured at the amount of the lease liability, plus any incremental costs of obtaining the lease and any lease payments made at or before the leased asset is available for use by the Group.

The right-of-use asset is subsequently measured at cost less accumulated depreciation and any accumulated impairment losses. Right-of-use assets are depreciated straight line over the following useful economic periods:

All right-of-use assets for the periods reported relate to property rights obtained as part of lease arrangements (see note 13(b)).

Depreciation is calculated using the straight-line method to allocate their depreciable amounts over their estimated useful lives as follows:

Furniture and fittings – 3 years
Office equipment – 3 years
Right-of-use property assets – shorter period of the remaining lease term or useful economic life

The residual values, estimated useful lives and depreciation method of property, plant and equipment are reviewed, and adjusted as appropriate, at each year end. The effects of any revision are recognised in profit and loss when the changes arise.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit and loss in the period of disposal.

The right-of-use asset is adjusted for any re-measurement of the lease liability and lease modifications, as set out in the lease accounting policy.

Key accounting estimate

Useful life of property, plant and equipment

The Group has property, plant and equipment assets that are depreciated over their useful lives. The useful life has been estimated based on expected use of the asset.

(b) Leases


2024 £			2023 £
08
	Current lease liability	583,820	563,633
	Non-current lease liability	1,801,699	2,404,272
	Total lease liability	2,385,519	2,967,905

Lease commitments for short-term leases at 31 December were as follows:


	2024 £	2023 £
Serviced office lease	218,942	190,737
	218,942	190,737

The group entered into a short-term lease contract for an office in Paris on 5 July 2023 for one year commencing from November 2023. This agreement has replaced the financing lease arrangements in place for offices in Paris discussed below. The total expense relating to short-term leases for the year was £166,734 (2022: £81,108).

The maturity of gross contractual undiscounted cash flows due on the Group’s lease liabilities is set out below based on the period between 31 December 2023 and the lease maturity date.


	Less than 1 year £	1 to 5 years £	Over 5 years £	Total at 31 December 2024 £
Jersey property leases	183,257	728,407	-	991,664
London property leases	516,140	1,213,195	-	1,729,335
	699,397	1,941,602	-	2,640,999

The Group leased the second and third floors of a property for its operations in Jersey, and two properties for its operations both in London and Paris during the period. The movement in right-of- use assets obtained as a result of lease arrangements and their associated depreciation charges are disclosed in note 13(a).

The lease for the second floor of the property in Jersey commenced on 1 January 2019 and was voluntarily concluded on 1 June 2023. The lease for the third floor commenced on 1 December 2017 and was also terminated on 1 June 2023, the contractual lease end date. The Group has agreed to continue to rent the same office space under a new lease which commenced on 2 June 2023. The new lease has a term of six years and break clause options at the end of year 2 and 4; the Directors have no intention of exercising either option at the transition date. Accounting for both leases is therefore on the basis of future cash flows on rental payments up to the contractual lease end date of 1 June 2029.

On 4 September 2023 the Group ended an agreement with Brevan Howard Asset Management LLP for the underlease of 82 Baker Street, London, W1U 6TE. The Group entered into a new lease at 3 Lombard Street, London EC3V 9AQ on 2 August 2023. The lease term is five years, commencing on 2 August 2023 and with an end date of 1 August 2028.

The Group leased two offices in Paris during the year, 11 rue Paul Lelong, from the point of acquisition of CSF in 2021 and 25 rue du 4 Septembre from 1 August 2022 with a contractual end dates of 4 April 2023 and 31 August 2023 respectively. Both leases were terminated during the period and CSF has since entered into a short-term lease which is discussed above.

Reconciliation of lease liabilities


08
	Jersey property	London property	Total
	leases £	leases £	£
At 31 December 2023	979,507	1,988,398	2,967,905
Repayments	(220,589)	(504,796)	(725,385)
Interest expense	47,792	95,207	142,999
At 31 December 2024	806,710	1,578,809	2,385,519

The Group has an operating lease arrangement in which it acts as a lessor in relation to office space sub-leased to a related party. The lease agreement includes a 2 month break clause option which is exercisable by either party.


Maturity analysis of operating lease payments:
	2024 £	2023 £
Within one year	22,000	22,000
	22,000	22,000

During the year, the Group received lease income on operating leases amounting to:


	2024 £	2023 £
Operating lease rental income	132,000	132,000
	132,000	132,000

Accounting policies

The Group as lessee

On commencement of a contract (or part of a contract) which gives the right to use an asset for a period of time in exchange for consideration, the group recognises a right-of-use asset and a lease liability unless the lease qualifies as a ‘short-term’ lease or a ‘low-value’ lease.

Short-term leases

Where the lease term is twelve months or less and the lease does not contain an option to purchase the leased asset, lease payments are recognised as an expense on a straight-line basis over the lease term.

Leases of low-value assets

Where the underlying asset in a lease is ‘low-value’, lease payments are recognised as an expense on a straight-line basis over the lease term.

Initial measurement of the lease liability

The lease liability is initially measured at the present value of the lease payments during the lease term discounted using the incremental borrowing rate because the interest rate implicit in the lease cannot be readily determined.

The lease term is the non-cancellable period of the lease plus extension periods that are reasonably certain to exercise and termination periods that are reasonably certain not to exercise.

Lease payments include fixed payments, less any lease incentives receivable, variable lease payments dependent on an index or a rate and any residual value guarantees. Variable lease payments are initially measured using the index or rate when the leased asset is available for use.

Subsequent measurement of the lease liability

The lease liability is subsequently increased for a constant periodic rate of interest on the remaining balance of the lease liability and reduced for lease payments. Interest on the lease liability is recognised in profit or loss.

Re-measurement of the lease liability

The lease liability is adjusted for changes arising from the original terms and conditions of the lease that change the lease term, the assessment of options to purchase the leased asset, the amount expected to be payable under a residual value guarantee and/or changes in lease payments due to a change in an index or rate. The adjustment to the lease liability is recognised when the change takes effect and is adjusted against the right-of-use asset, unless the carrying amount of the right-of-use asset is reduced to nil, when any further adjustment is recognised in profit or loss.

Adjustments to the lease payments arising from a change in the lease term or the assessment of its option to purchase the leased asset are discounted using a revised discount rate. The revised discount rate is calculated as the incremental borrowing rate at the date of the reassessment because the interest rate implicit in the lease cannot be readily determined.

Lease modifications

A lease modification is a change that was not part of the original terms and conditions of the lease and is accounted for as a separate lease if it increases the scope of the lease by adding the right to use one or more additional assets with a commensurate adjustment to the payments under the lease.

For a lease modification not accounted for as a separate lease, the lease liability is adjusted for the revised lease payments, discounted using a revised discount rate.

Where the lease modification decreases the scope of the lease, the carrying amount of the right-of- use asset is reduced to reflect the partial or full termination of the lease. Any difference between the adjustment to the lease liability and the adjustment to the right-of-use asset is recognised in profit or loss.

For all other lease modifications, the adjustment to the lease liability is recognised as an adjustment to the right-of-use asset.

The Group as lessor

Leases are classified as finance or operating leases. Whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases.

When the Group is an intermediate lessor, it accounts for the head lease and the sub-lease as two separate contracts. The sub-lease is classified as a finance or operating lease by reference to the right- of-use asset arising from the head lease.

Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

Significant judgement

Measurement of IFRS 16 lease liabilities and right-of-use assets

The directors have exercised a number of judgements in order to measure lease liabilities and right- of-use assets under IFRS 16, including the determination of the lease term and discount rate. The carrying value of the lease liabilities and right-of-use assets at the reporting date are shown on the face of the Statement of Financial Position and within notes 13(a) and 13(b) respectively.


(c) Goodwill	Notes	£
Cost At 31 December 2023		6,415,032
Acquired through business combination Exchange differences	(i)	1,305,780 -
At 31 December 2024		7,720,812
Accumulated impairment losses At 31 December 2023		5,473,525
Loss for the year		-
At 31 December 2024		5,473,525
Net book value
At 31 December 2024		2,247,287
At 31 December 2023		941,507

(i) In 2023 the Group entered into an option to acquire an 100% interest in Valkyrie Funds LLC (‘VFL’) on the condition that the Securities Exchange Commission (‘SEC’) in the United States approved the creation and ability to sell Bitcoin Exchange Traded Funds (‘ETF’). In January of 2024 the first Bitcoin ETF’s were approved and the Group subsequently exercised its right to acquire VFL. On 12 March 2024 the Group paid a consideration of £1,241,722 for 100% ownership resulting in a goodwill amount of £1,305,780. Refer to note 17 for business combinations during the year

Goodwill impairment charges and reversal of impairment charges are recognised in administrative expenses in the statement of comprehensive income.

The carrying value of goodwill has been allocated to Cash Generating Units (‘CGUs’) as follows:

2024 £ 2023 £


CoinShares AM	903,573	903,573
CoinShares Co	37,934	37,934
CoinShares Valkyrie	1,305,780	-
	2,247,287	941,507

The Group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired. Goodwill is impaired if the recoverable amount falls below the carrying amount of the CGU in question.

The recoverable amount for a CGU is defined as the higher of fair value less costs of disposal or value in use.

For CoinShares Asset Management (‘CSAM’), the goodwill amount of £903,573 relates to the value of the regulatory licenses held by the Group’s French entities. No impairment charge has been made during the year due to the retention of the license and the estimated cost to replace.

For CoinShares Valkyrie, the goodwill amount relates to the value in use of the relevant regulatory licenses and products from which the Group generates income as a result of the acquisition. No impairment charge has been made during the year due to the performance of the products to which this goodwill relates.

Accounting policies

Goodwill is not amortised but is reviewed for impairment at least annually. For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (or groups of cash-generating units) expected to benefit from the synergies of the combination. Cash-generating units to which goodwill has been allocated are tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash- generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent period.

On disposal of a cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

(d) Other intangible assets


04 05		Fee Generating Contracts £	Software £	Website Domains and Trademarks £	Total £
06	Cost
07	At 31 December 2023 Additions	12,180,776 74,999	1,974,062 1,091,443	12,902 -	14,167,740 1,166,442
08	Disposals	-	(321,460)	-	(321,460)
	Exchange differences	-	(17,318)	-	(17,318)
	At 31 December 2024	12,255,775	2,726,727	12,902	14,995,404
	Accumulated amortisation
	At 31 December 2023	3,919,814	529,094	2,321	4,451,229
	Charge for the year	1,395,344	171,673	434	1,567,451
	Disposals	-	(176,520)	-	(176,520)
	Exchange differences	310,860	(15,729)	-	295,131
	At 31 December 2024	5,626,018	508,518	2,755	6,137,291
	Net book value
	At 31 December 2024	6,629,757	2,218,209	10,147	8,858,113

Accounting policies

Intangible assets acquired in a business combination and recognised separately from goodwill are recognised initially at their fair value at the acquisition date.

Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less accumulated amortisation and accumulated impairment losses, on the same basis as intangible assets that are acquired separately.

Costs that are directly attributable to a project’s development phase are recognised as intangible assets, provided they meet all of the following recognition requirements:

the development costs can be measured reliably;
the project is technically and commercially feasible;
the Group intends to and has sufficient resources to complete the project;
the Group has the ability to use or sell the software; and
the software will generate probable future economic benefits.

Development costs not meeting these criteria for capitalisation are expensed as incurred.

Directly attributable costs include employee costs incurred on software development along with an appropriate portion of relevant overheads and borrowing costs.

Separately acquired intangible assets have finite useful lives and are measured at cost less accumulated amortisation and accumulated impairment losses. Amortisation of the depreciable amount is allocated systematically on the basis of the consumption of economic benefits over their estimated useful lives.

Amortisation is provided on the following basis:
Fee generating contracts 10 years
Software 3-5 years
Website domain names and trademarks 10 years

The estimated useful life and amortisation method are reviewed at the end of each year, with the effect of any changes in estimate being accounted for on a prospective basis.

Any capitalised internally developed software that is not yet complete is not amortised but is subject to impairment testing.

Amortisation has been included within administrative expenses.

Subsequent expenditures on the maintenance of these assets are expensed as incurred.

When an intangible asset is disposed of, the gain or loss on disposal is determined as the difference between the proceeds and the carrying amount of the asset, and is recognised in profit or loss within other gains or losses.

Impairment of non-financial assets

Goodwill impairment is covered in the goodwill accounting policy. All other non-financial assets are tested for impairment whenever there is any objective evidence or indication that these assets may be impaired.

If such an indicator exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The recoverable amount is the higher of value in use and fair value less costs of disposal. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit and loss.

When an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of the recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined if no impairment loss had been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately as a credit to profit and loss.

Key accounting estimate

Useful life of intangible assets

The Group has intangible assets that are amortised over their useful lives. The useful life has been estimated based on expected obsolescence of the assets that are amortised.

Equity

Share capital and premium

Allotted, called-up and fully paid


05	2024	2023	2024	2023
	Number	Number	£	£

Shares classified as equity

Ordinary shares of £0.000495 each 66,678,210 68,013,771 33,006 33,667

66,678,210 68,013,771 33,006 33,667

2024 £ 2023 £

Share premium 30,223,904 30,690,938

30,223,904 30,690,938

Ordinary shares issued and allotted are accounted for as equity. These shares confer on the holders the right to vote and receive dividends at the Company’s discretion. If, at the Company’s discretion, there is a return of assets, ordinary shares confer on the holders thereof the rights in respect of the assets of the Company available for distribution among the Shareholders. The Company is authorised to issue 200,000,000 shares.

All share premium balances relate to the issue of ordinary shares.

Movements in share capital


	Share Capital Number	£	Share Premium £
At 31 December 2023	68,013,771	33,667	30,690,938
Share cancellations	(1,474,631)	(730)	(665,835)
Share options exercised	139,070	69	198,801
As at 31 December 2024	66,678,210	33,006	30,223,904

The Group purchased 90,205 (2023: 1,597,706) shares on the public market for a total consideration of £268,995 (2023: £4,216,180) for the purposes outlined at the Group’s last AGM. The shares are held in the Treasury Share Reserve, included within other reserves, until they are cancelled or sold back to the market. On 14 February the Group announced the cancellation of all treasury shares held totalling 1,474,631 (2023: 200,050) with a value of £3,926,374 (2023: £551,399).

Accounting policies

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction from the proceeds.

During the year, the Company undertook a purchase of its own shares already in issue. The consideration paid, including any directly attributable incremental costs, is deducted from equity attributable to the owners as treasury shares until the shares are cancelled or reissued.

Other reserves

Included within other reserves in the Group are the following:


	Foreign Exchange Translation Reserve £	Share Option Reserve £	Treasury Share Reserve £	Total £
At 31 December 2023	11,138,564	4,323,974	(3,879,634)	11,582,904
Exchange differences on translation of foreign operations	3,174,922	-	-	3,174.922
Share buybacks	-	-	(268,995)	(268,995)
Share cancellations	-	-	3,926,374	3,926,374
Share options issued	-	1,068,269	-	1,068,269
Share options exercised	-	(243,431)	222,255	(21,176)
Share option cancelled	-	(63,116)	-	(63,116)
At 31 December 2024	14,313,486	5,085,696	-	19,399,182

The nature and purpose of each reserve in equity is described as follows:

Foreign exchange translation reserve

Foreign exchange gains and losses on translation of the results and net assets of the Group’s foreign operations accumulate in the foreign exchange translation reserve. On disposal of foreign operations, the cumulative translation gains and losses in respect of those operations are recycled through profit or loss.

Share option reserve

The share option reserve represents the cost of the Group’s cumulative unexercised share options. Once options are exercised, the cumulative expense in relation to those options is transferred to retained earnings.

Treasury share reserve

The treasury share reserve represents the considerations paid by the Group to repurchase its own shares until such a time that the shares are cancelled or sold back to the market.

RISK

Critical estimates, judgements and errors

The preparation of the Group financial statements requires management to make judgements, estimates and assumptions in applying accounting policies to determine the reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual results may differ significantly from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis.
1. Critical Judgements
  
  Accounting treatment of digital assets - note 9 Accounting treatment of ETPs - note 11(e)
  
  Measurement of IFRS 16 lease liabilities and right-of-use assets - note 13(b)
2. Key accounting estimates and assumptions
Valuation of investments - note 12

Useful life of property, plant and equipment - note 13(a) Useful life of intangible assets - note 13(d)

Share based payment costs - note 23

Financial risk management objectives and policies and capital management

The Group invests in a portfolio of digital assets and derivatives on a non-directional risk basis to generate a return, which matches its financial obligations to certificate holders. In pursuing its investment objective, the Group invests in digital assets and has a liability exposure towards certificate holders linked to digital assets, as well as the specific operational risks to trading and holding digital assets.

The following sets out a description of the principal risks inherent in the activities of the Group along with the action taken to manage these risks.

Market risk
1. Currency risk
  
  The Group seeks to mitigate currency risk, primarily experienced within its subsidiary CSCMJL. CSCMJL automatically converts amounts received in EUR and SEK from the sale of certificates by investors to US$. US$ is the functional currency of CSCMJL which automatically converts US$ to EUR and SEK as required to facilitate the redemption of notes. From time-to-time CSCMJL may hold small currency balances in currencies other than US$ to facilitate operational expenses and occasionally holds EUR on a temporary basis for the purchase of digital assets. The Group has considered the impact of movements in foreign exchange rates. An adverse/favourable movement in foreign exchange rates of 5% would result in a loss/gain on foreign exchange of approximately £7,089,729 and does not create any going concern issues.
  
  This is both due to the quantum and also the fact that these movements are largely hedged by the Group. However, given the functional and presentational currency of the Group is Pound Sterling,
  
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  additional foreign currency movements arise on consolidation and with equity accounting of its foreign operations (as defined under IAS 21) which result in movements through other comprehensive income.
2. Interest rate risk
  
  Interest rate risk is the risk that the value of the Group will be impacted by fluctuations in the prevailing levels of market interest rates.
  
  The Group has entered into a loan arrangement with a variable interest rate based on the base rate SARON 1 to 3 months. The directors have determined that as there is one loan, that this risk of the interest rate moving against the Group is acceptable. The loan renews for periods of 12 months at a time, so if the risk were determined to be too great, the Group could exit the arrangement, using other assets to pay the loan if necessary.
  
  The majority of the Group’s other financial assets and liabilities are either non-interest bearing, or at a fixed interest rate and as a result, the Group is not subject to significant amounts of risk due to fluctuations in the prevailing levels of market interest rates.
  
  The directors have considered the impact of movements in the SARON 1 to 3 months interest base rate. A 5% increase/decrease in the base rate would increase/decrease the Group’s annual interest cost in relation to the Reyl Loan to approximately £588,992 (CHF 663,972)/£532,897 (CHF 600,737) (2024 actual £834,516 (CHF 941,239)) and does not create any going concern issues.
3. Digital asset price risk
  
  Digital assets are an extremely volatile asset class. Digital asset price risk arises from the uncertainty about future prices of the digital assets, impacting both the fair value of the digital assets held by the Group and the fair value of the liabilities of the Group towards certificate holders.
  
  To mitigate its exposure to changes in prices of digital assets, any exposure to changes in prices on the digital assets held is matched by the changes in value of the obligations to security holders. The Group does hold some strategic digital asset balances for its own account over and above the amounts required to hedge its obligations. Movement in digital asset prices is illustrated in the sensitivity analysis presented in note 13(e).
  
  Reports are circulated every ten minutes showing the net digital asset exposure. In addition, the net exposure is constantly monitored, being the number of digital assets held versus the number of currencies required to cover the exposure towards certificate holders.
4. Risk of access to banking services
  
  The banking landscape and availability of banking partners for participants within the digital asset industry is ever-evolving, as has been evidenced by events following the financial year end. The Group has a variety of banking partners and is continually seeking additional, suitable partners to further mitigate the risk of over-reliance on a single or limited number of counterparties.
  
  The operations of the Group are reliant on the availability of efficient payment rails, particularly in the requirement to perform the hedging activities associated with the Group’s XBTP ETPs. No issues have arisen to date arising from banking capabilities that have proven to have a significant operational impact on the Group, and the continued expansion of our banking relationships is designed to ensure that this remains the case as we continue to grow.
  
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Credit risk

Credit risk is the risk that an issuer, counterparty or exchange will be unable or unwilling to meet a commitment, obligation under a financial instrument or contract that it has entered into with the Group, leading to a financial loss, or lack of liquidity and restriction of access to the Group’s assets. The Group is exposed to credit risk due to the range of counterparties with which it is required to interact.

Certain transactions that the Group may enter into exposes it to the risk that the counterparty will not deliver the asset (purchase) or cash (sale) after the Group has fulfilled its responsibilities. The Group only transacts with brokers which have been approved by the Group as acceptable counterparties.

Digital assets and exchanges

Digital asset activity has an inherent credit risk due to the nature of the industry, which is non-regulated, extremely volatile, has low barriers to entry and is vulnerable to bad actors. The Group continues to implement a range of controls, policies and procedures around the trading and holding of digital assets on exchange which has improved the quality of counterparties and reduced overall risk. Furthermore, the Group has established proof of concept with a number of exchanges and custodians to enable trading without keeping assets on the platforms, thereby mitigating almost all counterparty risk. Assets remain with the custodian and settlement is conducted once a day on a net basis, de-risking activities considerably.

The Group has in place a formal compliance monitoring programme (“CMP”) whereby counterparties are selected on an annual basis for testing. In 2023 the Group also implemented a daily monitoring process to monitor levels of exposure with each of its counterparties in order to ensure that agreed limits are adhered to. In such an event that this is not the case, this process informs any decisions made around the ultimate location of assets and ensures ongoing adherence with the CMP. Ultimately risk limits are discussed at and set by the Group’s Risk & Compliance Committee. Additional measures undertaken by the Group include enhanced on-boarding, compliance and periodic risk reviews and/ or utilising exchanges which are audited and report sufficient liquid positions. Prior to entering into a relationship with an exchange, it is a requirement for the counterparty to complete a questionnaire covering policies, procedures and processes in place in relation to cybersecurity, access, technology and data amongst other areas. Exchanges are assessed by the compliance team and placed into tiers which determine the level of exposure that is deemed acceptable. This tiering approach is undertaken in accordance with the Group’s counterparty risk framework. The procedures in place are ultimately designed to ensure only reputable, long-standing and mature exchanges are used.

It is necessary for operational reasons to keep a balance with exchanges in order to purchase, transfer and swap digital assets, in the ordinary course of business. The Group seeks to minimise the quantum of cash balances held on exchange.

The total credit risk exposure to the Group arising from balances held with exchanges is as follows:

2024 £ 2023 £

Digital assets 125,671,376 103,937,400

Cash and cash equivalents 8,351,756 2,576,217

134,023,132 106,513,617

Current asset exposure 3% 4%

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Staking providers

As at 31 December 2024, a significant amount of the Group’s ETH were held with service providers for the purpose of staking. This activity brings rise to two considerations; firstly, the time it takes to exit a validator position and secondly, safeguarding of assets by the service providers.

Financial instruments and cash deposits

Credit risk from balances with banks, brokers and financial institutions is managed, monitored and controlled by the finance department in accordance with Group policy. Transactions that involve surplus cash inflows and outflows are only with approved counterparties and brokers within credit limits that have been agreed between the parties. The credit limits are reviewed by the compliance team and agreed upon by the Board of Directors on an annual basis. The limits are set to minimise the concentration of risks and therefore mitigate financial loss. Furthermore, regular risk reviews are performed over the use of the banks and brokers to manage credit risk.

Transactions that expose the Group to the risk that the counterparty will not deliver the asset (purchase) or cash (sale) after the Group has fulfilled its responsibilities, is managed through brokers which have been approved by the Group as acceptable counterparties.

The Group also has receivables as a result of loans. The Company only enters into loans with reputable counterparties and in the case of digital asset loans these are all recallable on demand. The Company therefore does not expect to incur material losses with these loans.

The Group undertakes transactions with counterparties that may expose it to the risk that the counterparty will not deliver from their side, for example in the cases of sales (cash), purchases (assets) or equivalent loans. The Group mitigates this by reviewing counterparties before transactions occur, and determining their acceptability, with the use of collateral where deemed necessary. In the event that such a transaction is ongoing, such assessments are regularly performed in order to safeguard assets and mitigate any risks arising in relation to recoverability.

Included in other assets disclosed in note 11(b) are shares in ETPs, valued at £952,665,878 (2023:

£211,384,245) used to provide exposure to digital assets and are held as a part of the Group’s collateral management obligations. These ETPs are fully collateralised and management maintains regular communications with their operators. The ETPs are regulated and audited.

Expected credit losses

The measurement of impairment losses depends on whether an asset is ‘performing’, ‘underperforming’ or ‘nonperforming’ based on the Group’s assessment of increases in the credit risk of an asset since its initial recognition and any events that have occurred before the year-end which have a detrimental impact on cash flows. The asset moves from ‘performing’ to ‘underperforming’ when the increase in credit risk since initial recognition becomes significant.

In assessing whether credit risk has increased significantly, the Group compares the risk of default at the year-end with the risk of a default when the asset was originally recognised using reasonable and supportable past and forward-looking information that is available without undue cost. The risk of a default occurring takes into consideration default events that are possible within 12 months of the year- end (‘the 12-month expected credit losses’) for ‘performing’ assets, and all possible default events over the expected life of those debtors (‘the lifetime expected credit losses’) for ‘underperforming’ assets.

The Group recognises lifetime ECL when there has been a significant increase in credit risk since initial recognition. However, if the credit risk has not increased significantly since initial recognition, the Group measures the loss allowance at an amount equal to 12-month ECL.

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Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of an asset. In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result from default events that are possible within 12 months after the reporting date.

The calculation of expected credit losses is a function of the probability of default, loss given default (i.e. the magnitude of the loss if there is a default) and the exposure at default. The assessment of the probability of default and loss given default is based on reasonable and supportable past and forward- looking information that is available without undue cost or effort. As for the exposure at default, this is represented by the assets’ gross carrying amount at the reporting date. The expected credit loss is a probability weighted amount determined from a range of outcomes and takes into account the time value of money.

Impairment losses and any subsequent reversals of impairment losses are adjusted against the carrying amount of the asset and are recognised in profit and loss.

For trade receivables, expected credit losses are measured by applying a simplified method using a provision matrix. The expected loss rate comprises the risk of a default occurring and the expected cash flows on a default based on the ageing of the debtor. The risk of a default occurring always takes into consideration all possible default events over the expected life of those debtors. Different provision rates and periods are used based on groupings of historic credit loss experience by product type, customer type and location.

Digital asset lending

The Group has receivables as a result of digital asset loans (see note 11(b)). Developments in the digital asset industry in recent years have resulted in an elevated level of counterparty risk. The risks associated with this type of activity is loss of assets due to the third-party counterparty not engaging in their own risk management systems, or theft through malpractice, lack of corporate governance associated with a low regulatory environment, and lack of systems and controls.

All existing loans are governed by a single form Master Loan Agreement (“MLA”), are open term, repayable on demand (second business day after notification), and are denominated in only two digital currencies (Bitcoin and Ethereum). As with our exchange counterparties, part of the take on process for each lending counterparty requires an initial assessment, and then subsequent ongoing monitoring. Any breaches noted which would deem the risk of lending these counterparties to fall outside of acceptable limits will result in the relationship being exited and the assets returned inclusive of the interest accrued. We do not enter into, or continue with, relationships that we deem to carry credit risk that may impact the recoverability of any loaned assets. That being said, an inherent risk of course remains.

Interest is calculated and accrued daily and payable on the first business day of the following month. Because the amounts are repayable on demand, the interest automatically forms part of the loan balance outstanding until paid.

All digital asset loans are considered to be ‘performing’ in line with the IFRS staging. As such only the Stage 1 (12-month ECL) provisioning needs to be considered. Any impairment beyond 12 months would likely have already led to the relationships being terminated on current terms and an actual or expected life-time loss within 12 months being relevant. There is unlikely to be any distinction between Stages 1 and 2 for the Group unless term loans are provided in the future.

In determining the loss given default (“LGD”) and probability of default (“PD”), the Group has considered its digital asset lending counterparties on a case-by-case basis, with a credit premium driven PD adjusted for the period under review.

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02

03

04

05

06

07

08

The following table presents the 12-month ECL recognised as at 31 December 2024 in respect of the Group’s digital asset loans and balances held on exchange, together with their calculation inputs.

EAD

£

LGD

%

PD 12 month ECL

% £

Digital assets loans 158,414,459 50% 1.24% (average) 1,487,322

1,487,322

Liquidity risk

Liquidity risk is the risk that the Group will encounter difficulties in meeting obligations associated with financial liabilities, in particular towards certificate holders.

The following maturity analysis shows that liquidity risk is as follows:


	Carrying amount as at 31 December 2024 £	On demand £	Less than 3 months £	More than 3 months £
Current assets
Trade and other receivables	2,977,315	-	2,977,315	-
Cash and cash equivalents	19,859,572	19,859,572	-	-
Digital assets*	3,627,205,737	3,627,205,737	-	-
Other assets	1,113,357,091	1,113,357,091	-	-
Total current assets	4,763,399,715	4,760,422,400	2,977,315	-
	Carrying amount as at 31 December 2024 £	On demand £	Less than 3 months £	More than 3 months £
Current liabilities
Accounts payable	1,097,923	1,097,923	-	-
Accrued liabilities	9,245,432	-	9,245,432	-
Certificate liability	4,171,982,360	4,171,982,360	-	-
Current tax liability	91,987	-	-	91,987
Lease liabilities	583,820	-	-	583,820
Amounts due to brokers	79,011,258	79,011,258	-	-
Other liabilities	201,457,063	-	201,457,063	-
Total current liabilities	4,463,649,843	4,252,091,541	210,882,495	675,807

Net current assets/ (liabilities)

299,749,872 508,330,859 (207,905,180) (675,807)

Pursuant to contractual agreements between certificate holders and the Group, the Group is providing hedging services to certificate holders by buying digital assets to match the liabilities of the Group.

Liquidity issues could arise as a result of the redemption of certificates. In this case, the Group would be required to have sufficient liquidity to finance the redemption of the certificates. The prospectus and final terms for each series of notes issued by XBTP define the formula at which the certificates can be redeemed based on an average of the price of the reference digital assets on three different exchanges to provide the contractual exposure defined in the final terms.

The terms and conditions of the certificates include provisions under which, upon the occurrence of certain market disruptions, delays in the settlement of the certificates may be incurred or certain modifications be made. Each certificate holder may exercise the holder put option and have their certificates redeemed on the tenth business day following the end of the calendar month after the month of the exercise of the notice, in case the calculation agent determines that an asset disruption event has occurred, the certificates’ redemption will be postponed until the asset disruption event ceases. These contractual provisions would also act as liquidity risk mitigating factor for the Group.

In the first instance, the cash held at brokers, and then the cash at bank would be used, while the proceeds from the sale of the digital assets would be transferred to pay the noteholders.

Liquidity would thereafter be generated by trading the digital assets already held at the exchanges. The float of digital assets held at the exchanges is monitored in real time by the trading team to make sure that the float is sufficient to deal with possible redemption requests. When the trading team believes that more digital assets are required, digital assets held in cold storage with Komainu and Zodia (2022: Komainu and Zodia) are transferred within 48 hours to the exchanges. Conversely, when the amount of digital assets held at exchange is in excess of the liquidity requirements, then digital assets are transferred to cold storage with Komainu and Zodia (2022: Komainu and Zodia).

The liquidity risk is further mitigated by only holding the most liquid digital assets, Bitcoin and Ethereum, for the purpose of hedging the notes.

For the securities held by CSDSL, liquidity issues could arise as a result of the redemption of securities, however only if these were to be redeemed in cash rather than in digital asset. The prospectus defines when this could occur, but is the exception rather than the rule. In this case, the Group would be required to have sufficient liquidity to finance the redemption of the securities. The prospectus and final terms for each security define the formula at which the securities can be redeemed based on a coin entitlement.

Securities holders can request redemption of their securities which will be settled two business days following a valid redemption notice. The Group ensures that it holds the relevant digital asset at all times to be able to meet these redemptions.

Capital risk management

The capital of the Group is represented by the net assets attributable to ordinary shareholders. The Group’s objective when managing capital is to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain a strong capital base to support the development of the investment activities of the Group. This is achieved through actively managing the Group’s Bitcoin, Ethereum and related products.

For the purpose of the Group’s capital management, capital includes issued share capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Group’s capital management is to maximise the shareholder value.

The Group manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares.

The Group monitors capital using a gearing ratio, which is ‘net debt’ divided by total capital plus net debt. The Group has minimal debt and has a policy of keeping the gearing ratio as low as possible.

No changes were made in the objectives, policies or processes for managing capital during the years ended 31 December 2024 and 2023.

Financial instruments settled through digital assets

The Group has entered into perpetual and futures contracts with digital asset exchanges. These contracts offer synthetic exposure to digital assets while reducing working capital requirements.

A perpetual futures contract is a derivative product that is similar to a traditional futures contract, but has a few differing specifications:

There is no expiry or settlement; and
Perpetual contracts mimic a spot market and hence trade close to the underlying digital asset price. This is in contrast to a traditional futures contract which usually trades at a different price due to the time basis or time until maturity of the contract. The primary mechanism to tether the perpetual futures contract to the spot price is an interest funding mechanism.

The following table shows positions held as at 31 December 2024, inclusive of any unrealised gains/ losses and margins held.


	Contract amount (DA)	Margin held £	Unrealised gain/(loss) £	Impact on other current liabilities £
Perpetual Contracts
BTC exposure	156	11,656,781	(2,079,109)	(2,079,109)
ETH exposure	983	2,655,640	(18,438)	(18,438)
Other digital asset exposure Futures Contracts	863,251	688,096	538,278	538,278
BTC exposure	224	16,765,618	1,679,487	1,679,487
ETH exposure	2,761	7,457,297	1,161,827	1,161,827
39,223,432 1,282,046				1,282,046

In order to maintain the above positions, equity is held with the exchanges. The funding and settlement of Perpetual Contracts can only be done in digital assets, there is no fiat currency settlement.

Operational risk

These are risks relating to losses as a result of operational matters such as having inappropriate or insufficient routines, human error, systems failures and legal risks.

The main operational risk for the Group would be the inability to provide the contractual hedge through either systems failures or continuity planning issues. The risk is mitigated through the use of a highly secure algorithmic trading platform hosted in the cloud to mitigate the risk of human error. The business continuity plan was tested, and demonstrated that the traders can perform their work from anywhere.

The Group has controls designed to monitor transactions, and flag any possible inconsistencies in trading, acting as further mitigating factors for human error.

The risk of hacking, and losing Bitcoin/Ethereum and other digital assets in digital wallets due to fraud is reduced through the majority of the digital assets being kept in cold storage with Komainu and Zodia (2023: Komainu and Zodia), providing a cold storage vault. Komainu has a SOC 1 Type 2 report, the latest covering the period from 1 December 2023 to 30 November 2024. Zodia currently has a SOC 1 Type 1 report and a SOC 1 Type 2 report for the period 1 January 2023 to 31 December 2023. A SOC 1 Type 2 report for the period 1 January 2024 to 31 December 2024 is in progress and expected to be completed in Q1 2025. Both Komainu and Zodia are also ISO27001 certified. In addition to limiting the exposure to fraud for the Group, cold storage of digital assets with Komainu and Zodia also reduces the exposure to hacking of the exchanges. The exchanges are constantly monitored and the Group has built a net asset buffer which reduces operational risk.

The cyber risks are mitigated through the use of systems to prevent external attacks (firewalls, detection of possible phishing emails, encryption using secure keys and strong physical security for example).

Carrying amount as at

Price change


04		31 December 2024 £	-50% £	100% £
05	Assets Digital assets held as inventory	2,442,813,368	1,270,516,364	4,787,407,376
06	Digital assets held as collateral	1,184,392,369	592,196,185	2,368,784,738
07	Other assets	1,171,855,371	615,176,826	2,285,212,462
08	Total assets	4,799,061,108	2,477,889,374	9,441,404,576
	Liabilities
	Certificate liability - XBTP	(2,987,589,993)	(1,404,812,569)	(6,153,144,767)
	Certificate liability - CSDSL	(1,184,392,367)	(592,196,184)	(2,368,784,734)
	Other liabilities	(313,123,449)	(172,889,289)	(593,591,770)
	Total liabilities	(4,485,105,809)	(2,169,898,041)	(9,115,521,271)
	Net assets	313,955,299	307,991,333	325,883,305

The above analysis shows the impact of both a fifty percent decline and a one hundred percent increase in digital assets prices. A 50% decline in digital asset prices would reduce the Group’s net asset position to £.308.0 million and does not create any going concern issues.

GROUP STRUCTURE

Business combinations

Acquisition of Valkyrie Funds LLC

On the 12 March 2024 the Group exercised its option to acquire 100% of VFL following the launch of Valkyrie Bitcoin Fund in January 2024 post the SEC’s approval of a Bitcoin ETF. VFL is a US digital asset manager’s investment advisory business specialising in actively managed cryptocurreny exchange traded funds. The acquisition was made to enhance and develop the Group’s asset management business in the US, with a clear focus on product innovation and market differentiation.


The details of the business combination is as follows:
	2024 £
Fair value of consideration transferred Amount settled in cash	800,304
Fair value of other consideration	207,978
Total consideration transferred	1,008,282

Recognised amounts of identifiable net assets
Cash and cash equivalents	21,320
Trade and other receivables	56,996
Total current assets	78,316

Trade and other payables	(375,813)
Total current liabilities	(375,813)

Identifiable net assets	(297,497)

Goodwill on acquisition (note 13)	1,305,780

Consideration transferred settled in cash	800,304
Cash and cash equivalents acquired	(21,320)
Net cash outflow on acquisition	778,984

All expenses associated with the acquisition of VFL have been recognised in administration expenses.

Acquisition of Circa5000

On 3 December 2024 the Group entered into a Share Purchase Agreement to acquire 100% of Circa5000’s ordinary share capital. The acquisition was made to acquire a regulated entity that enhances the Group’s asset management business through offering its products to a wider audience of consumers under the ICAV registration.

The details of the business combination is as follows:

2024 £

Fair value of consideration transferred

Amount settled in cash 74,999

Fair value of other consideration -

Total consideration transferred 74,999

Recognised amounts of identifiable net assets

Cash and cash equivalents 129,276

Intangible asset - regulatory license 74,999

Total current assets 204,275

Trade and other payables (129,276)

Total current liabilities (129,276)

Identifiable net assets 74,999

Goodwill on acquisition -

Consideration transferred settled in cash 74,999

Cash and cash equivalents acquired (129,276)

Net cash outflow on acquisition (54,277)

All expenses associated with the acquisition of Circa5000 have been recognised in administration expenses.

Accounting policies

Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of assets transferred by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interest issued by the Group in exchange for control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred.

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value at the acquisition date, except that:

deferred tax assets or liabilities and assets or liabilities related to employee benefit arrangements are recognised and measured in accordance with IAS 12 and IAS 19 respectively;
liabilities or equity instruments related to share-based payment arrangements of the acquiree, or share-based payment arrangements of the Group entered into to replace share-based payment arrangements of the acquiree are measured in accordance with IFRS 2 at the acquisition date; and
assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 are measured in accordance with that Standard.

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see above), or additional assets or liabilities are recognised, to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the amounts recognised as of that date.

Interests in other entities

(a) Investments in subsidiaries


Name Defined as	Investee Relationship	CSIL’s Ownership %	Jurisdiction	Date of Acquisition
XBT Provider AB (publ) XBTP	Subsidiary	100%	Sweden	25/09/2017
CoinShares GP II Limited CSGP2L	Subsidiary	100%	Jersey	09/02/2018
CoinShares Corporate CSCSJL	Subsidiary	100%	Jersey	25/06/2018
CoinShares Co CSCo	Subsidiary	100%	USA	01/07/2018
CoinShares Employment CSESJL	Subsidiary	100%	Jersey	09/08/2018
CoinShares Digital Securities CSDSL	Subsidiary	100%	Jersey	30/06/2020
CoinShares (Jersey) Limited CSJL	Subsidiary	100%	Jersey	26/09/2018
GABI Trading Limited GTLA	Subsidiary	100%	Hong Kong	12/02/2019
CoinShares Capital Markets CSCMJL	Subsidiary	100%	Jersey	30/06/2019
CoinShares Capital Markets CSCMUKL	Subsidiary	100%	UK	30/06/2019
CoinShares Capital, LLC CS Cap	Subsidiary	100%	USA	18/09/2019
CoinShares GP I LLC CSGPI	Subsidiary	100%	USA	20/03/2020
CoinShares France CSF	Subsidiary	100%	France	17/12/2021
CoinShares Asset CSAM	Subsidiary	100%	France	04/07/2022
Larks Leaf Asset Management LLAMJL	Subsidiary	100%	Jersey	27/02/2023
CoinShares Bitcoin Integrated BIS

The Company’s direct subsidiaries which make up the Group as at 31 December 2024 are as follows:

Services (Jersey) Limited

Services (Jersey) Limited Limited

(Jersey) Limited (UK) Limited

Management (Jersey) Limited

Strategies Master Fund Limited

CoinShares Bitcoin Integrated Strategies Feeder Fund Limited

CoinShares Ethereum Integrated Strategies Master Fund Limited

CoinShares Ethereum Integrated Strategies Feeder Fund Limited

CoinShares Relative Value Opportunities Master Fund Limited

Master Subsidiary 100% Jersey 27/02/2023

Feeder

Master

Feeder

Master

BIS Subsidiary 100% Jersey 27/02/2023 EIS Subsidiary 100% Jersey 06/04/2023 EIS Subsidiary 100% Jersey 06/04/2023 RVO Subsidiary 100% Jersey 06/04/2023


CoinShares Relative Value RVO Limited	100%	Jersey	06/04/2023
CoinShares Switzerland CSSAG Subsidiary	100%	Switzerland	24/05/2023
CoinShares Bitcoin US BIS US Subsidiary	100%	USA	05/06/2023
CoinShares Ethereum US EIS US Subsidiary	100%	USA	05/06/2023
CoinShares Relative Value RVO US Fund, LP	100%	USA	27/07/2023
CoinShares Bitcoin GP CS BGPL Subsidiary	100%	Jersey	29/11/2023
CoinShares Ethereum GP CS EGPL Subsidiary	100%	Jersey	29/11/2023
CoinShares Relative CS Limited	100%	Jersey	29/11/2023
Valkyrie Funds LLC VFL Subsidiary	100%	USA	12/01/2024
Circa5000 UK Ltd Circa5000 Subsidiary	100%	Ireland	03/12/2024

Opportunities Feeder Fund

Feeder Subsidiary

Feeder Fund, LP Feeder

Opportunities US Feeder

Feeder Subsidiary

Limited Limited

Value Opportunities GP

RVOGPL Subsidiary

On 19 March 2024 CoinShares (UK) Limited was formally dissolved.

On 10 April 2024 XBT Provider AB (publ) changed its name to CoinShares XBT Provider AB (publ).

As at 31 December 2024, Larks Leaf Asset Management (Jersey) Limited and Circa5000 UK Ltd were in the process of being dissolved, with the latter having applying for strike off on 3 February 2025.

On 27 September 2024, the Group resolved to enter the following entities CoinShares Ethereum Integrated Strategies Master Fund Limited, CoinShares Ethereum Integrated Strategies Feeder Fund Limited, CoinShares Ethereum Integrated Strategies US Feeder Fund LP, plus the general partner to the US CoinShares Ethereum GP Limited (together “EIS entities”) into liquidation. The EIS entities ceased operations on 1 October 2024. These are expected to be wound up in 2025.

CONTINGENT ITEMS

Commitments

(a) Guarantee

The Group has issued a guarantee in respect of tracker certificates issued by XBTP.

The obligations arising on XBTP from the certificates are managed by CSCMJL, which hedges the exposure of these liabilities.

CSCMJL has procured a hedge to cover the obligations of XBTP to the certificate holders by having an identical exposure in digital assets under the terms of the collateral management agreement. At 31 December 2024, CSCMJL recorded a net equity position of £269.1 million ($337.4 million) (2023:

£200.4 million ($255.1 million)).

The guarantee could be called in the case of extreme events, such as an operational error, hacking or fraud impacting the hedging provided by CSCMJL which results in CSCMJL’s net equity being insufficient to settle XBTP’s obligations. In the opinion of the directors, there are sufficient controls and processes in place to mitigate such a risk by; (i) holding a float of digital assets at the exchanges which is monitored by the trading team to ensure there is a sufficient balance to deal with any redemption requests, (ii) using controls designed to monitor unusual transactions to mitigate factors for human error, (iii) CSCMJL’s automatic trading system is designed so that exposure to changes in prices of digital assets are matched by changes in value of the obligations towards XBTP, (iv) limiting exposure to currency risk by using US$ as the functional currency and hedging foreign currency exposures by regularly monitoring all foreign currency denominated assets and liabilities, (v) storing the majority of digital assets offline with an institutional custody service and (vi) using a secure algorithmic trading platform hosted on the cloud.

As a result of the controls and processes in place, the directors consider that the risk of the guarantee being called on is very remote, and accordingly there is no provision or liability recorded within these financial statements.

(b) Offsetting financial assets and financial liabilities

2024 £ 2023 £

DGLD 154,134 2,129,715

Assets due to third parties (154,134) (2,129,715)

Total - -

The Group holds 81.71 DGLD (2023: 1,313 DGLD) on behalf of MKS. The Group does not receive any economic benefit for holding these assets and the risks associated with holding the assets remain with MKS.

The Group does not receive any economic benefit for holding these assets and the risks associated with holding these assets remain with the third party. The directors of the Group have elected to offset these transactions as they judge the inclusion in the statement of financial position would misrepresent the position of the Group.

01

02

03

04

05

06

07

08
Events occurring after the reporting period

On February 24, 2025, the Group confirmed that it held no exposure to the Bybit Exchange.

On February 25, 2025, the Group’s Nomination Committee proposed the re-election of all existing Board members at the forthcoming Annual General Meeting.

On February 25, 2025, the Group reported another block transaction executed by a shareholder, whereby the Group repurchased from the selling shareholder a total of 200,000 ordinary shares at a price per share equal to SEK 75.00 resulting in total consideration of SEK 15,000,000.

On March 3, 2025, the Group announced that a total of 52,241 options from the Employee Incentive Plan’s November 2020 Tranche were exercised at an exercise price of £1.43 (SEK 19.29) per share. This exercise resulted in proceeds of £74,705 (SEK 1,007,566) for the Group. The shares were settled from the Group’s existing balance of own shares.

On March 5, 2025, the Group reported a block transaction executed by a shareholder, whereby the Group repurchased from the selling shareholder a total of 200,000 ordinary shares at a price per share equal to SEK 74.75 resulting in total consideration of SEK 14,950,000.

On March 13, 2025, the Group announced that a total of 25,000 options from the Employee Incentive Plan’s November 2020 Tranche were exercised at an exercise price of £1.43 (SEK 19.29) per share. This exercise resulted in proceeds of £35,750 (SEK 464,042) for the Group. The shares were settled from the Group’s existing balance of own shares.

On March 19, 2025, the Group reported another block transaction executed by a shareholder, whereby the Group repurchased from the selling shareholder a total of 200,000 ordinary shares at a price per share equal to SEK 73.00 resulting in total consideration of SEK 14,600,000.

On March 25, 2025, the Group announced its selection as one of the two providers for BourseBank’s new cryptocurrency exchange-traded product (ETP) offering. The Group is providing five of the six products featured in BourseBank’s initiative.

On March 25, 2025, the Group granted 345,038 new options over ordinary shares under its Employee Incentive Plan, representing 0.52% of the issued share capital. The options, which have an exercise price of SEK 72.8, will vest on March 24, 2028.

On March 26, 2025, a further 75,000 options were exercised from the November 2020 tranche at an exercise price of £1.43 (SEK 18.49), generating proceeds of £107,250 (SEK 1,387,011.88). These were settled using treasury shares.

01

02

03

04

05

06

07

08

FURTHER DETAILS

Cash flow information

Non-cash investing and financing activities

Non-cash investing and financing activities disclosed in other notes are:
- acquisition and disposal of right of use assets - note 13(a)
- options issued to employees under the equity settled share option plan for no consideration - note 23(a)

Net debt reconciliation

This table sets out the analysis of net debt movements during the years.


	2024 £	2023 £
Cash and cash equivalents - note 11(c)	19,859,572	25,507,944
Borrowings - note 11(g)	(19,682,176)	(23,145,127)
Lease liabilities - note 13(b)	(2,385,519)	(2,967,905)
Net debt	(2,208,123)	(605,088)


	Cash and cash equivalents £	Borrowings £	Lease liabilities £	Total £
At 31 December 2022	134,768,902	(22,152,484)	(1,336,487)	111,279,931
Financing cashflows	(103,595,437)	61,488	666,353	(102,867,596)
New leases	-	-	(3,008,294)	(3,008,294)
Terminated leases	-	-	703,325	703,325
Exchange differences	(5,665,521)	(1,046,561)	7,198	(6,704,884)
Other charges
Interest expense	-	(885,719)	(77,866)	(963,585)
Interest payments presented as operating cashflows	-	878,149	77,866	956,015
At 31 December 2023	25,507,944	(23,145,127)	(2,967,905)	(605,088)
Financing cashflows	(18,837,558)	2,165,776	582,717	(16,089,065)
New leases	-	-	-	-
Terminated leases	-	-	-	-
Exchange differences	13,188,855	1,276,086	-	14,464,941
Other charges
Interest expense	-	(834,516)	(142,999)	(977,515)
Interest payments presented as operating cashflows	-	855,605	142,999	998,604
At 31 December 2024	19,859,241	(19,682,176)	(2,385,188)	(2,208,123)

The table above does not include the Group’s digital asset holdings that do not form part of the collateral/hedge work undertaken for CSDSL and XBTP. These assets represent liquid assets of the Group as at 31 December 2024 of £35,662,397 (2023: £31,122,973).

Related party transactions

The Group discloses transactions with related parties which are not wholly owned within the same Group. Where appropriate, transactions of a similar nature are aggregated unless, in the opinion of the directors, separate disclosure is necessary to understand the effect of the transactions on the Group financial statements.


(a) Subsidiaries
Interests in subsidiaries are set out in note 18(a).
(b) Transactions with group directors	2024 £	2023 £
Short-term employee benefits	1,379,032	900,987
Share-based payments	101,053	310,225
	1,480.085	1,211,212

Mr Daniel Masters is the Group’s Chairman and a shareholder of the Group. During the year, the Group undertook trades on his behalf in various assets equating to £6,177,858 (2023: £746,079). As at the year end the Group held nil (2023: £nil) assets owed to Mr Masters. The Group also holds a receivable from Mr Masters and one other person jointly of $37,183 (£29,639) (2023: $37,183 (£29,826)) in relation to an investment that was transferred using the Group as a broker. Mr Masters also has a holding in CS2LP. As at the end of the year, Mr Masters’s holding is valued at £5,270,140 (2023: £5,588,734). Mr Masters is paid remuneration in his role as Chairman of the board as disclosed above and in the remuneration report. As at year end, £10,417 is payable in regards to this. The Group has also paid amounts on behalf of Mr Masters which is repaid regularly. The Group has paid £1,615 on his behalf, of which £243 is receivable at the year end.

Mr Jean-Marie Mognetti is the Group’s Chief Executive Officer and a shareholder of the Group. During the year the Group undertook trades on his behalf of £213,552 (2023: £nil). As at the year end the Group held 9.08 BTC valued at £679,476 (2023: 30,000 AVT (£17,909)) due to Mr Mognetti. Mr Mognetti is also a director of Tactiques D’Avant-Garde (Jersey) Limited (‘TAG’). During the year the Group undertook trades on behalf of TAG of nil (2023: 6.50 BTC, equating to £150,546). As at 31 December 2024, £nil (2023: £nil) was outstanding from TAG to the Group.

Mr Richard Nash is a person discharging managerial responsibility and a shareholder of the Group. During the year, the Group undertook trades on his behalf of £117,713 (2023: £nil). As at the year end, the Group held 3 BTC (2023: 0.3 BTC) on his behalf.

Mr Johan Lundberg is a non-executive director of the Group. During the year the Group undertook trades on his behalf equating to £50,227 (2023: £144,243). As at the year end the Group held nil assets (2023: nil) owed to Mr Lundberg.

Transactions with other related parties

FlowBank Holdings SA (‘FlowBank’) is an associate with the Group. On 13 June 2024, FlowBank SA, a subsidiary of FlowBank had its licence as a bank and securities dealer withdrawn by the Swiss Financial Market Supervisory Authority (‘FINMA’). As such, the Group decided to fully impair its investment in FlowBank resulting in an impairment charge of £21,813,042.

CSGP2L, a subsidiary of the Group, acts as General Partner of CS2LP. In this capacity, it receives quarterly an amount of one quarter of two percent of the net asset value of CSF2LP. During the year

£126,760 (2023: £128,487) has accrued for this fee, of which £32,394 (2023: £32,029) was outstanding at the year end.

The Group has recognised carried interest in CS2LP as at the year end of £4,881,489 (2023: £5,429,067) which is held as an investment. The Group also settled expenditure on behalf of CS2LP of £nil (2023:

£2,433) of which £nil (2023: £nil) is outstanding at the year end.

The Group has an investment in Komainu Holdings Limited (‘KHL’) of which Mr Jean-Marie Mognetti is a director and shareholder. The Group has settled expenditure on behalf of KHL in the year of £nil (2023: £6,718) of which £nil (2023: £nil) remains outstanding at year end. The Group has a recharge agreement with KHL which allows for use of office facilities. £121,000 (2023: £132,999) has been charged for the year of which £11,000 (2023: £11,000) is outstanding at the year end.

Komainu (Jersey) Limited (‘KJL’), a wholly owned subsidiary of KHL provides custodial services to the Group. During the year, the Group paid fees to KJL of £2,859,578 (2023: £792,885) of which £347,749 (2023: £119,051) was outstanding at the year end. In the prior year the Group also settled transactions on behalf of KJL which had fees retained that are required to be returned to KJL. Fees of £10,804 have been returned, of which £61 is outstanding at the year end. The Group had a service agreement with KJL which allows for support regarding staking and operations. £nil (2023: £5,000) has been charged for the year. The full amount invoiced in 2023 of £16,000 was been written off at the end of 2023 leaving a balance of £nil outstanding. An additional amount was also been charged in relation to a staff cost of

£nil (2023: £7,000) of which £nil (2023: £7,000) is outstanding at year end.

GTSA is an investee company of the Group. The Group has settled expenditure on behalf of GTSA in the year of £1,603 (2023: £248) of which £nil (2023: £nil) remains outstanding at year end.

On 10 January 2023 the Group agreed to enter into block transactions with two shareholders to acquire 196,654 ordinary shares in the capital of the Company, at a price per share equal to SEK 24 resulting in total consideration of SEK 4,719,696 (£372,856). Of these, 75,000 shares were acquired from a person discharging managerial responsibility, and 121,654 shares were acquired from an entity affiliated with the Group. The transaction was completed on 13 January 2023.

On 28 February 2023 the Group agreed to enter into a block transaction with a shareholder, who is also a person discharging managerial responsibility, to acquire 50,000 ordinary shares in the capital of the Company, at a price per share equal to SEK 33 resulting in total consideration of SEK 1,650,000 (£130,984). The transaction was completed on 10 March 2023.

On 24 March 2023 the Group agreed to enter into a block transaction with a shareholder to acquire 160,000 ordinary shares in the capital of the Company, at a price per share equal to SEK 29 resulting in total consideration of SEK 4,640,000 (£356,101). The transaction was completed on 31 March 2023.

On 26 May 2023 the Group agreed to enter into a block transaction with a shareholder, who is also a Director, to acquire 358,783 ordinary shares in the capital of the Company, at a price per share equal to SEK 30 resulting in total consideration of SEK 10,804,500 (£796,492). The transaction was completed on 14 June 2023.

Share-based payments

Equity-settled share option plan

The establishment of the employee incentive share plan was approved by the board on 16 October 2020. The employee incentive share plan is designed to provide long-term incentives for employees and managers to deliver long-term shareholder returns. Under the plan, participants are granted options which only vest if certain performance criteria are met. Participation in the plan is at the board’s discretion, and no individual has a contractual right to participate in the plan or to receive any guaranteed benefits.

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Performance based options:

The performance based options in issue by the Group vest when indicators of Group performance meet criteria defined in the options certificate. External indicators include growing firmwide AUM, increasing the number of ETP certificates in issue and the customer count. Internal metrics such as measures of team performance are also used to track if the vesting criteria are being met.

The options have an exercisable period of 10 years from the date of the grant of the option.

Time based options:

There are two separate options in issue. Some of the time based options in issue by the Group have a vesting period of between 2-3 years from the issue date and expire 10 years from the vesting date. Other options issued in March 2021 vest in 8 equal tranches, on a quarterly basis, over a two year period.
Share option liquidation scheme

Share options were repurchased from employees during the year under a scheme operated to allow the voluntary early liquidation of share options. 48,409 (2023: 10,446) options were liquidated during the period for a total consideration of £39,511 (2023: £8,613) (note 14(a)).
Performance Based Options

2024 2023

Number of share options

Weighted average exercise

price £

Number of share options

Weighted average exercise

price £


Opening	1,149,995	1.43	1,773,600	1.43
Forfeited	-	-	(623,605)	1.43
Liquidated	-	-	-	-
Closing	1,149,995	1.43	1,149,995	1.43
Exercisable at closing	1,149,995		1,149,995


(d) Time Based Options
		2024		2023
	Number of share options	Weighted average exercise price £	Number of share options	Weighted average exercise price £
Opening	2,537,949	3.89	2,202,857	4.33
Granted	115,000	3.64	448,000	1.68
Forfeited	(93,641)	4.38	(96,983)	1.83
Exercised	(222,217)	1.59	(5,479)	1.43
Liquidated	(48,409)	2.85	(10,446)	1.43
Closing	2,288,682	2.94	2,537,949	3.89
Exercisable at closing	1,349,733		1,129,445

222,217 time based options (2023: 5,479) were exercised during the year for an aggregate settlement of £353,404.

115,000 time based share options were granted on 20 March 2024. The fair value of the options granted is £189,994.

48,409 time based share options were liquidated during the period, for a total consideration of £39,511. The options outstanding at 31 December 2024 had a weighted average exercise price of £2.95 (2023:

£2.63) and a weighted average remaining contractual life of 0.61 years (2023: 0.5 years).


Grant date	Exercise price SEK	Exercise price £
March 2024	50.40	3.64

The fair value of the options issued during the year at the grant date was calculated using the Black- Scholes methodology. The method takes into account the exercise price, the term of the option, the share price at the grant date, the expected volatility of the underlying share, the expected dividend yield, the risk-free interest rate for the term of the option and the correlations and volatilities of peer group companies.

The total share-based payment expenses for the year are £1,000,202 (2023: £1,324,818). All amounts are equity settled and there are no liabilities in relation to share-based payment transactions outstanding at the reporting date (2023: £nil).

Accounting policies

Equity-settled arrangements are measured at fair value at the date of the grant.

The fair value of share options under the employee incentive plan are estimated using the fair value at the grant date. The fair value of share options is calculated using the Black-Scholes method. The Strike Price was set at 31.00 based upon the value of the shares on the issue date, the risk free rate selected was 3.25%. The vesting condition is 3 years and 70% of options are assumed to vest. At the time of awarding these options, the Group did not have a dividend policy so this was not incorporated into the valuation.

The fair value determined at grant date is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of the number of equity instruments that will eventually vest. At each reporting date, the Group revises its estimate of the number of equity instruments expected to vest as a result of the effect of non-market-based vesting conditions. The impact of the revision of the original estimates, if any, is recognised in profit or loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to reserves.

Where equity-settled arrangements are modified, and are of some benefit to the employee, the incremental fair value is recognised over the period from the date of modification to date of vesting. Where a modification is not beneficial to the employee there is no change to the charge for share- based payments. Settlements and cancellations are treated as an acceleration of vesting and the unvested amount is recognised immediately in profit and loss.

Arrangements are considered to be forfeited where the conditions of the grant are no longer deemed to be met. This arises where an employee is no longer employed by the Group and where share options are either not yet vested or have not been exercised before the date of them leaving the Group, or in the case of performance options, where the conditions set out have not been met. Forfeitures are treated as an acceleration of vesting and the unvested amount is recognised immediately in profit and loss.

The Group operated a scheme to allow the voluntary early liquidation of share options. Liquidations are treated as an acceleration of vesting and the unvested amount is recognised immediately in profit and loss.

Key accounting estimate

Share based payment costs

Earnings per share

As more fully disclosed in note 23, share options were issued during previous years, which have had a dilutive effect. The Group made a loss in the prior year, therefore the share options are antidilutive and have not been included in the calculation of diluted earnings per share.

The calculation of the basic and diluted earnings per share is based on the following data:


2024 £		2023 £
Earnings Earnings for the purposes of basic earnings per share being net profit attributable to 104,359,320 owners of the Company		46,439,648
Earnings for the purposes of diluted 104,359,320		46,439,648
2024 Number		2023 Number
Number of shares Weighted average number of ordinary shares for the purposes of basic earnings 66,543,318 per share		67,287,929
Weighted effect of dilutive potential 3,677,235		3,977,029
Weighted average number of ordinary shares for the purposes of diluted 70,220,553		71,264,958
earnings per share
	2024 £	2023 £
Basic earnings per share	1.56	0.69
Diluted earnings per share	1.48	0.65

earnings per share

ordinary shares: Share options

Summary of other accounting policies

These policies have been consistently applied to all the years presented, unless otherwise stated.

Fair value measurement

The Group measures financial instruments such as ETPs, and non-financial assets such as digital assets, at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability or, in the absence of a principal market, in the most advantageous market for the asset or liability accessible by the Group.

The fair value hierarchy under IFRS is set out as follows:

Level 1 – The unadjusted quoted price in an active market for identical assets or liabilities that the Group can access at the measurement date.

Level 2 – Inputs other than quoted prices included in Level 1 that are observable (i.e. developed using market data) for the asset or liability, either directly or indirectly.

Level 3 – Inputs are unobservable (i.e. for which market data is unavailable) for the asset or liability.

For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

On a quarterly basis, the board of directors analyses the movements in the values of assets and liabilities which are required to be remeasured or re-assessed as per the Group’s accounting policies.

Investment valuations are subject to several key judgements and reflect both local and external economic factors. In selecting the investment valuation criteria, the directors evaluate the key drivers relevant to each investment in conjunction with local partners, supported, wherever practicable, by local market data. As such, fair value measurements for investment valuations have been classified as Level 2 or Level 3 depending on the information available.

Level 1 and 2 valuations and inputs

The finance department performs monthly valuations of the Group’s investments that are classified as Level 1 and 2 within the fair value hierarchy, utilising market data (investments in listed equities) and observable inputs (CoinShares Fund II LP – carried interest and investments held at cost or price of recent investment that may subsequently be reclassified to Level 3). Discussions of valuation processes and results are held between the Chief Financial Officer, Audit and Risk Committee and the Board once every quarter, in line with the Group’s reporting periods.

Level 3 valuations and inputs

The finance department performs quarterly valuations of the Group’s investments that are classified as Level 3, within the fair value hierarchy, utilising a range of observable and unobservable inputs. Discussions of valuation processes and results are held between the Chief Financial Officer, Audit and Risk Committee and the Board once every quarter, in line with the Group’s reporting periods.

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The main Level 3 inputs used by the Group are derived and evaluated as follows:
- price of recent investment;
- earnings multiples, estimated based on market information for similar types of companies;
- AUM multiples, estimated based on market information for similar types of companies; and
- percentage ownership of net asset value of the investee company.
  
  Fair value policies and disclosures on specific balances are summarised in the following notes: Digital assets Note 9
  
  Investments Note 11
  
  Financial instruments Note 12
  
  For all other assets and liabilities measured at fair value, the directors perform an internal valuation exercise to determine fair value using methodologies disclosed in the Group Investment Valuation Policy.
Foreign currency translation

Transactions and balances

Foreign currency transactions are translated into the functional currency of the relevant Group entity using the exchange rates prevailing at the dates of the transactions.

At each reporting date, monetary assets and liabilities denominated in a foreign currency are translated into the functional currency of the relevant Group entity at the closing exchange rate. Non-monetary assets and liabilities denominated in a foreign currency, and measured at historical cost, are initially translated into the functional currency of the relevant Group entity at the date of the transaction, and are not subsequently re-translated. Non-monetary assets and liabilities denominated in a foreign currency, and measured at fair value, are measured using the exchange rate at each date the fair value is determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit and loss.

Foreign exchange gains and losses from the translation of assets and liabilities measured at fair value are recognised as part of the fair value gain or loss.

Translation

For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group’s overseas subsidiaries are translated at exchange rates prevailing on the reporting date. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the date of transactions are used. Exchange differences arising, if any, are recognised in other comprehensive income and accumulated in a foreign currency translation reserve (attributed to non-controlling interests as appropriate).

On the disposal of an overseas subsidiary all of the exchange differences accumulated in a foreign currency translation reserve in respect of that subsidiary attributable to the owners of the Group are reclassified to profit or loss.

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Retirement benefits

The Group operates a defined contribution scheme for the benefit of its employees. Contributions payable are charged to profit or loss in the year they are payable. The assets of the scheme are held separately from those of the Group in an independently administered fund.
Employee benefits

Employee benefits are recognised as an expense, unless the cost qualifies to be capitalised as an asset

Short term benefits

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably.

The Group may compensate employees for absence for various reasons including vacation, sickness and parental leave. There is non-accumulating compensation of absence and this does not carry forward; it will lapse if the current period’s entitlement is not used in full, therefore the Group does not recognise a liability or expense until the time of absence.

Annual bonus plan

The Group operates a bonus plan for employees. An expense is recognised in profit and loss when the Group has a legal or constructive obligation to make payments under the plan as a result of past events and a reliable estimate of the obligation can be made.
Adoption of new and revised Standards

New and amended IFRS Standards that are effective for the current year

The Group has applied the below amendments to IFRS Standards and Interpretations issued by the IASB that are effective for annual periods beginning from 1 January 2024:

Classification of Liabilities as Current or Non-Current (Amendments to IAS 1)
Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)
Non-current Liabilities with Covenants (Amendments to IAS 1)
Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7)

The adoption of these amendments has not had any material impact on the disclosures or on the amounts reported in these financial statements

New and revised IFRS Standards in issue but not yet effective

Certain amendments to accounting standards have been published that are not mandatory for 31 December 2024 reporting periods and have not been early adopted by the group. These amendments are not expected to have a material impact on the reported profit or loss, net assets or total equity of the Group in the current or future reporting periods and on foreseeable future transactions.

CONTACT

CoinShares International Limited 2nd Floor

2 Hill Street St Helier

Jersey, JE2 4UA Channel Islands

Website: coinshares.com

Email: [email protected]


(b) Offsetting financial assets and financial	liabilities
	2024 £	2023 £
DGLD	154,134	2,129,715
Assets due to third parties	(154,134)	(2,129,715)
Total	-	-

AI Terminal

CoinShares International Ltd.

6038_10-k_2025-04-01_f7feef7c-0d56-42ff-b435-d8f6487a5adf.html

BOARD OF DIRECTORS AND EXECUTIVE MANAGEMENT

Board of Directors

Management Team

‌MESSAGE FROM THE CEO

Our Business Model and Strategic Direction

Competitive positioning

Lack of Equity Value Recognition

Looking Forward

‌SUMMARY OF FINANCIAL PERFORMANCE

‌COINSHARES ASSET MANAGEMENT

2024 OVERVIEW

2025 OUTLOOK

‌COINSHARES CAPITAL MARKETS

2024 OVERVIEW

‌2025 CRYPTO MARKET OUTLOOK

‌CORPORATE GOVERNANCE REPORT

‌SUSTAINABILITY REPORT

‌AUDITED FINANCIAL STATEMENTS

CONTENTS

COMPANY INFORMATION

DIRECTORS’ REPORT

INDEPENDENT AUDITOR’S REPORT

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

CONSOLIDATED STATEMENT OF CASH FLOWS (1/2)

CONSOLIDATED STATEMENT OF CASH FLOWS (2/2)

CONTENTS TO THE NOTES TO THE CONSOLIDATED

FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

General information and material accounting policies

Change in accounting policies

Significant changes in the current reporting period

Operating segment information

Material profit or loss items

Hedging Activities

Financial assets and liabilities

Other Financial assets- Investments

Non-financial assets and liabilities

Equity

Critical estimates, judgements and errors

Financial risk management objectives and policies and capital management

Business combinations

Interests in other entities

CONTINGENT ITEMS

Commitments

Events occurring after the reporting period

FURTHER DETAILS

Cash flow information

Related party transactions

Share-based payments

Earnings per share

Summary of other accounting policies

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