Bitcoin Custody Arrangements

Update on bitcoin custody following recent security incidents in the sector. None of the company's bitcoin is held with Binance; holdings are spread across Coinbase, Fidelity and Anchorage Digital, with segregation, insurance and multi-person authorisation controls.

The Smarter Web Company PLC provides the following update regarding its Bitcoin custody arrangements, in light of recent reports on security incidents within the digital asset sector. The Company recognises the significant contribution Binance has made to the development and adoption of the digital asset industry. We are encouraged by Binance's proactive response to recent events and its stated commitment to protecting affected customers, supported by its financial resources. For clarity, the Company does not hold any of its Bitcoin with Binance, with its holdings instead maintained across its established institutional custody providers.

The Company's Bitcoin holdings are held through established, institutional-grade custody providers, with Bitcoin currently held across Coinbase, Fidelity and Anchorage Digital. The Company's custody strategy has been deliberately structured to prioritise the security and protection of its Bitcoin holdings, while reducing reliance on any single provider. Key features of these arrangements include:

Diversification: Bitcoin is held across multiple institutional custodians operating in different regulatory jurisdictions, reducing concentration and counterparty risk.
Asset protection: Custody arrangements incorporate contractual and legal protections designed to segregate the Company's Bitcoin holdings from the custodians' own assets, with protections varying by provider.

Insurance arrangements: The Company's institutional custody arrangements incorporate insurance-related protections, with certain custodians contractually required to maintain insurance and others confirming that they maintain insurance against specified risks, including certain cyber incidents and theft. The nature, scope and availability of insurance coverage vary between providers and are subject to the terms, conditions, limits and exclusions of the relevant policies. The Company considers these arrangements to provide an additional layer of risk mitigation alongside its diversified custody structure, contractual asset protections and internal security controls.

Institutional security: Private keys are managed by the respective custodians, which operate institutional security controls.

Internal controls: Significant transactions are subject to multi-person authorisation within the Company, ensuring that no single individual can independently initiate and approve such transactions.

Operational flexibility: The Company retains the ability to transfer Bitcoin between its custody providers, allowing it to respond to changing circumstances and manage counterparty exposure.

The Company's approach to Bitcoin custody is based on multiple complementary layers of protection, including the use of established institutional custodians, diversification across providers and jurisdictions, contractual and legal asset protections, institutional private-key security, internal transaction authorisation controls and insurance arrangements maintained by its custodians. The Board believes that this combination provides a robust framework for managing custody and counterparty risk, recognising that no individual measure can eliminate all potential risks associated with holding Bitcoin.

Andrew Webley, Chief Executive Officer of The Smarter Web Company, commented:

“We have taken a deliberate and considered approach to how we safeguard our Bitcoin holdings, recognising that the strength of our custody arrangements is just as important as the scale of our treasury.

“By establishing relationships with multiple leading institutional custodians, we have built a diversified custody framework designed to provide strong asset protection, operational resilience and flexibility as our Bitcoin treasury continues to develop.

“We believe this approach provides a strong foundation for the long-term execution of our Bitcoin treasury strategy and reflects our commitment to building a credible and enduring institutional Bitcoin treasury company.”

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