DigitalX Faces Market Headwinds Despite Cost Cuts and New Trading Strategy

DigitalX Strengthens Bitcoin Position

DigitalX Limited, Australia's longest-standing publicly listed digital asset manager, has reported a strategic consolidation in the December 2025 quarter. The company increased its total Bitcoin exposure to approximately 504 BTC, combining direct holdings and units in its ASX-listed Bitcoin ETF (BTXX). This positions DigitalX as the largest ASX-listed Bitcoin company, a notable milestone amid a softer capital markets environment for crypto assets globally.

Market-Neutral Trading Strategy Deployment

In a bid to diversify revenue streams and reduce reliance on Bitcoin price movements, DigitalX allocated around A$4.9 million to a market-neutral digital asset trading strategy managed by Lime Street Capital. This approach aims to generate non-correlated cash flows that can be reinvested into Bitcoin acquisitions or used to offset operating expenses. Early returns from this strategy were positive, delivering a 0.65% gain in the quarter while Bitcoin prices declined sharply.

Operational Reset and Cost Discipline

The quarter also saw a comprehensive operational reset that yielded approximately $1 million in annualised cost savings. These savings stemmed from reductions in both staff and non-staff expenses, alongside simplification of technology and operational structures. Operating cash outflows dropped by 38% compared to the previous quarter, reflecting a leaner and more scalable cost base. This reset positions DigitalX to better withstand market volatility and scale its operations efficiently.

Financial Position and Asset Valuation

Despite a $24 million decrease in cash and assets during the quarter, primarily due to falling digital asset prices, DigitalX maintained a strong balance sheet with total cash, listed digital assets, and unlisted investments valued at $77.8 million. The company’s DigitalX Bitcoin ETF, while down 22.97% for the quarter in line with Bitcoin’s price movement, has delivered a robust 53.26% return since its July 2024 inception, managing $47.7 million in assets under management.

Sell My Shares Business and Corporate Stability

DigitalX’s Sell My Shares platform underwent operational improvements including formalised compliance procedures, enhanced internal controls, and streamlined workflows. These changes have fortified the business’s foundation while maintaining service continuity. The platform contributed $722,944 in revenue during the quarter, underscoring its role in DigitalX’s broader strategy for sustainable cash generation. Notably, there were no changes to the company’s board or senior management, and no material events occurred post-quarter, indicating corporate stability.