Debt-Fueled Crypto Buying: How Loss-Making Public Companies Inflate Their Market Value

A growing number of loss-making public companies — from biotech firms to gold miners, hotel operators, EV manufacturers, and even vape producers — are tapping debt markets to acquire cryptocurrency, hoping the move will boost their share prices.

According to Financial Times, around 154 publicly listed companies have either raised or committed to raising a combined $98.4 billion this year alone for crypto purchases. The trend is attracting investors who see exposure to digital assets without directly holding them, effectively turning these companies into publicly traded crypto proxies.

Case in point:

• KULR Technology (US) — Despite posting an operating loss of $9.4 million in Q1, the thermal management company holds $118 million in bitcoin, against a market capitalization of $211 million.
• Smarter Web (UK) — The website development firm generated just £93,000 in net profit in H1, yet boasts a £560 million market cap, largely due to £238 million worth of bitcoin on its balance sheet.

Critics warn that this “crypto-in-debt” play creates a bubble within a bubble, amplifying the correlation between equities and digital assets. While the strategy may temporarily lift valuations, it increases leverage and market fragility, particularly if crypto prices turn.

For now, the inflows are significant enough to impact crypto prices — but the sustainability of such debt-fueled buying remains in question. As companies blend speculative asset accumulation with fragile fundamentals, the line between financial engineering and genuine value creation continues to blur.