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Following record operating performance from Sell My Shares and disciplined cost management, DigitalX ended FY26 with its first cashflow-positive quarter
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DigitalX will start an on-market share buy-back next week, demonstrating confidence in its investment program and Sell My Shares expansion
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The company retains a sizeable treasury of cash, cash equivalents and Bitcoin while progressing market-neutral yield strategies
Special Report: DigitalX ended the financial year with a major milestone, delivering its first cashflow-positive quarter as it balances a sizeable Bitcoin portfolio with expanding businesses and new capital initiatives.
The June quarter result reflects a shift in DigitalX (ASX:DCC) strategy over recent years to build recurring revenue streams alongside its digital assets, reducing exposure to cryptocurrency market movements.
A key contributor to the result was the trading platform of wholly-owned subsidiary Sell My Shares (SMS).
This delivered record unaudited FY26 revenue of about $2.88 million and its busiest month on record, processing more than 1200 trades during June.
DigitalX also maintained about $30m in cash and cash equivalents invested in US Treasury Bills and term deposits.
Bitcoin’s new era on ASX
At the same time DigitalX has continued to maintain its place as the largest Bitcoin holder on the ASX
The company sold 120 Bitcoin at an average price of US$65,281 ($94,154), generating gross proceeds of around US$7.83m ($11.29m), while retaining more than 280 Bitcoin on its balance sheet.
DCC says the remaining holding provides the scale to support a new phase of treasury management during the second half of 2026.
This includes progressing to two market-neutral Bitcoin yield strategies for potential implementation following an extensive review of Bitcoin yield opportunities.
Unlike simply holding Bitcoin for price appreciation, the proposed strategies aim to generate annualised returns of 5% to 15%, regardless of Bitcoin’s price movements.
DigitalX said the strategies were designed to preserve its long-term Bitcoin exposure while minimising exchange and counterparty risk.
It also aims to avoid capital gains tax events by using Bitcoin as collateral rather than selling the underlying asset.
The company expects any large-scale implementation would utilise Bitcoin held through its investment in the DigitalX Bitcoin Fund (ASX:BTXX).
This move reflects a broader trend among institutional Bitcoin holders seeking to generate additional returns from digital assets without sacrificing exposure to the cryptocurrency’s long-term upside.
Capital management focus
DigitalX’s stronger financial position also underpins an on-market share buy-back, announced in late June.
The company plans to repurchase up to 120.36m shares, the maximum permitted, with purchases expected to begin from July 13.
This also reflects the board’s confidence in the company’s underlying assets, growth prospects and disciplined capital management.
Record SMS growth
While SMS operates in the equities sector, this subsidiary of DigitalX has continued to benefit from ongoing digitisation of retail investing.
SMS specialises in making it easier to sell issuer-sponsored shares (often acquired via an IPO or employee share scheme) without a traditional brokerage account.
Alongside record transaction volumes and revenue, SMS introduced AI-powered customer support and fraud detection tools during the year to improve operating efficiency and customer experience.
Management notes that Federal Government capital gains tax changes announced in the May Budget may have contributed to increased trading activity.
Additionally, the purchase of the sellmyshares.com domain during the quarter is expected to strengthen the platform’s branding and support future customer acquisition.
“Achieving our first cash flow positive quarter represents an important milestone for DigitalX and reflects the works undertaken over the past year to strengthen the business, simplify our cost base and grow our operating platform,” DCC executive chair Leigh Travers said.
“Sell My Shares continues to perform strongly and has become an increasingly important contributor to the company’s financial performance.
“Combined with our strong balance sheet and strategic Bitcoin treasury, we are well positioned to pursue disciplined capital allocation opportunities, including market-neutral treasury strategies and complementary strategic investments that we believe can deliver long-term shareholder value.”
Search for strategic acquisitions
Beyond its digital asset operations, DigitalX continues to review acquisition opportunities through its Strategic Investment Program.
The focus is on revenue-generating businesses that can strengthen the company’s operating platform while also diversifying earnings.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.