The directors present the strategic report for the year ended 31 December 2024.
BCB Group Holdings Limited (the “Company”) was incorporated on 16 April 2018. The Company is the Parent Company of the BCB Group of companies (collectively “BCB” or the “Group”), including the following principal trading subsidiaries: BCB Payments Limited, BCB Markets Limited, BCB Markets (Switzerland) Sàrl, BCB Payments (Europe) SASU and BCB Digital Limited (see note 15 for details of all Group subsidiaries).
BCB's primary activity is the provision of multi-currency payment services to corporate B2B customers operating in the digital asset industry or with a digital asset nexus. In addition, BCB provides OTC and web-based trading services for both foreign exchange and digital currencies to its corporate customers.
In October we launched our all-in-one stablecoin, fiat and crypto payments product, Cross Pay.
Instant B2B Payments
BCB operates the BLINC instant settlement network, allowing its customers (businesses only, no consumers) to pay each other instantly on a 24/7/365 basis. This network continues to see sustained growth, both by volume and number of transactions. Volume growth was 238% year on year to 31 December 2024 (2023: 177%).
Multi-currency
BCB offers payments accounts in 23 fiat currencies. BCB continues to complement its existing banking partner network, both for trading and for payments, with additional high quality partners. Latest additions to the network include Barclays Bank and Natwest.
Commitment to tier 1 Jurisdictions and Regulatory Compliance
BCB Payments (Europe) SASU received final approval from the French regulator for an e-money licence (“French EMI”) in April 2024 with full passporting across the European Economic Area (EEA) achieved in June 2024. This licence highlights BCB’s strategic focus on acquiring tier 1 regulatory licences and combined with existing regulated operations in the United Kingdom and Switzerland, reinforces BCB's commitment to providing financial services within robust regulatory frameworks. The French EMI licence enables BCB to offer flexible and tailored payment and e-money solutions across the European Union. By leveraging passporting rights afforded by the EEA, BCB will expand its reach to provide seamless payment and e-money services to customers throughout the region.
BCB has submitted its MICA license application and has started the application process for licences in the UAE which is becoming an increasingly important hub for the crypto industry.
Innovation in Digital Asset Services
In addition to the EMI licence, BCB secured a Digital Asset Service Provider (DASP) registration in France that enables BCB to offer digital currency custody, secure digital wallets (launched in Q2 2024), facilitate digital currency payments and offer trading of various digital currencies. By providing a comprehensive suite of digital currency services, BCB is catering to the growing demand for innovative financial products and services that leverage blockchain technology.
Regulatory Oversight in France
BCB Group’s French EMI and DASP licences are subject to oversight by the Autorité de Contrôle Prudentiel et de Résolution (ACPR) and the Autorité des Marchés Financiers (AMF) respectively. These regulatory bodies ensure compliance with French financial regulations and protect the interests of clients, consumers and investors.
Enhanced Trading Capabilities
To address the growing demand for efficient and secure trading solutions, BCB built BCB Markets, a self-service platform, accessible via both graphical user interface (GUI) and API offering customers smart order routing capabilities with low latency, high availability, and reliability. By providing this solution, BCB enhances its ability to serve the market's demand for innovative and complementary financial products and services.
BCB considers the following key risks to be most relevant to its current operations.
Market risks
BCB services the digital asset industry through the provision of payment and trading services. The Group limits its direct digital currency exposure to a strategic treasury holding in Bitcoin that is also used as a trade settlement float.
The Group’s indirect exposure to digital currency price volatility arises from the impact on transaction and trading volumes (from which it derives revenue) where such volumes typically correlate to price volatility and digital currency market sentiment more broadly.
Product risk
The successful execution of the strategic plan is dependent on BCB’s product offering remaining in demand from its target markets. With the growth in the digital asset ecosystem and the increasing adoption of digital assets, particularly stablecoins, within the wider financial system, we envisage an increase in competitors and it is critical that our offering remains relevant in this rapidly evolving ecosystem.
Dependence on key personnel and management risks
BCB’s business is dependent on retaining the services of its senior management team, and the loss of a key individual could have an adverse effect on the future of the Group’s business. BCB’s future success will also depend in large part upon its ability to attract and retain highly skilled personnel. This risk is managed by offering compensation (salaries, benefits and share options) that is competitive in the current market as well as a rewarding environment in which to work. Risk is further mitigated by ensuring robust succession planning and hiring and retaining competent and experience personnel at all level of the organisation.
Regulatory risk
BCB operates in a rapidly evolving sector, the regulatory approach to which is not always certain and is still developing. The Group seeks to comply with all applicable laws and regulations. A breach of regulatory requirements may have adverse reputational, financial, or other impacts on the Group. In addition, regulatory factors may result in the withdrawal of service of our banking partners and other service providers, which could adversely affect the Group’s ability to trade. The board of directors considers these risks seriously and designs, maintains and reviews the policies and processes so as to mitigate or avoid these risks.
Liquidity/solvency risk
As a venture backed, high growth business, BCB is dependent on successive funding rounds to sustain its growth. While the Group’s financial resources have decreased since its series A raise, the Group’s budgets and forecasts show the path to breakeven without the need for further funding. However, there remains a risk that unexpected events could result in the Group having insufficient financial resources to meet its obligations. Successfully closing our series B round will materially reduce the risk.
Cyber risk
BCB trades digital currencies via software and hardware which may prove to be vulnerable to data security breaches in the future. Data security breach incidents may compromise the confidentiality, integrity or availability of data such that the data is vulnerable to access or acquisition by unauthorised persons. These data security breaches may result in the unrecoverable loss of digital currencies. The Group’s hardware and software devices may be breached and result in the loss of valuable data. Loss of the private keys required to access the digital currencies may result in irrecoverable loss of access to the digital currencies, which may not be covered by insurance (whether in full or part). In order to mitigate these risks, the Group holds its digital currencies with third party specialist digital asset custodians with a number of security measures in place.
Group strategy and business model
BCB seeks to provide institutional grade payment, trading and settlement services to its B2B customer base, acting as the predominant supplier from tier 1 onshore jurisdictions to the corporate and institutional participants in the global digital asset ecosystem.
BCB minimises its direct exposure to digital currency prices while supplying payment services to the ecosystem. BCB holds Bitcoin as a treasury asset and currently uses this as a trading float along with other fiat and stablecoin currencies.
BCB reports its business across three segments as follows:
BCB Payments is currently the largest segment by revenue. This segment charges customers for payment accounts and transactions. These fees are predominantly account set-up, subscription transaction fees and credit interest.
BCB Markets segment is the trading service that the Group provides to customers as well as a small Proprietary Trading component. The customer trading includes both fiat and digital currency pair offerings. The majority of customer trade revenue is generated from OTC trading with the GUI offering that is better suited to smaller trades.
Other revenue arises from ancillary and consultancy services.
Effective 1 January 2024, our two Swiss subsidiaries (BCB Prime Services (Switzerland) Sàrl and BCB Payments (Switzerland) AG) were merged into one subsidiary, BCB Markets (Switzerland) Sàrl. This merger was carried out to simplify group operations and optimise capital allocation as we prioritise growth through the French EMI and DASP licences.
Revenue, revenue growth, gross profit and earnings before tax are the indicators most relevant to the Group.
BCB Payments segment revenue was £15,991,757 (2023: £9,237,520) representing a 73% increase year on year. Variable transaction fees accounted for 22% (2023: 29%) while recurring revenue increased to £6,075,307 (2023: £4,758,478). The key driver of this revenue composition change was the continued success in onboarding new customers and a move towards a recurring pricing model.
BCB Markets segment revenue was £1,556,434 (2023: £2,592,360) representing a 40% decline year on year. The split between fiat and digital currency revenue was 24:76 (2023: 31:69). The key driver of this decrease and shift in revenue towards digital currency trading was sustained customer demand for digital asset to fiat trading compared with declines in demand for fiat to fiat, due to increasing market competition in the fiat-only trading sector.
Gross profit was £12,828,148 (2023: £9,356,533) representing a 37% increase year on year and a gross margin of 72.8% (2023: 71.7%). The key driver of both the gross profit and gross margin increase was the growth in revenue generated by the BCB Payments business segment that historically has a higher gross margin.
The loss before taxation was £5,653,327 (2023: £25,532,066) representing a 78% decrease year on year. The 2023 loss includes an exceptional impairment of the Sutor Bank loan note and accrued interest of £8,890,158. The 2024 loss reflects the revenue growth and continued discipline and control over the cost base in 2024.
The Group’s year end cash balance was £365,116,871 (2023: £189,909,525) including segregated, safeguarded customer funds of £361,258,103 (2023: £176,120,488). These funds are fully segregated from BCB’s own funds in safeguarding bank accounts and term deposits at high quality banking institutions and approved money market funds (MMFs) in compliance with the FCA safeguarding regulations.
The Group’s year end net liabilities amounted to £350,795 (2023: net assets £5,515,405) reflecting the underlying loss for the year. The directors expect net assets to grow in the near term as the Group completes its series B funding round, including the conversion of $17.325 million loan notes into equity.
The directors remain positive about BCB’s prospects for the year ahead. They believe that the Group has and will continue to enhance its reputation and position in the digital assets markets to deliver profitable revenue growth.
As part of its series B strategy, existing investors contributed a further $10 million in convertible loan notes in September 2025, to sustain continued investment in growth.
BCB’s plans include further product, regulatory and geographical expansion to de-risk its operations and consolidate its position at the centre of its chosen markets.
The directors believe they have acted in the way most likely to promote the success of the Company for the benefit of its members as a whole as required by s172 of the Companies Act 2006.
The requirements of s172 are for the Directors to:
Consider the likely consequences of any decision in the long term
Act fairly between the members of the Company
Maintain a reputation for high standards of business conduct
Consider the interests of the Company's employees
Foster the Company's relationships with suppliers, customers and others
Consider the impact of the Company's operations on the community and the environment.
The long-term interests of BCB are most influenced by operational delivery, regulatory compliance, product innovation and balancing investment with the drive for profitability in the context of the Group’s liquidity ahead of its next funding round.
Growing BCB’s customer base and maintaining strong relationships with all stakeholders has always been and remains the key focus. Our banking partners remain critical suppliers to the business and building this network to ensure we continue to provide functional and reliable products while meeting safeguarding requirements is paramount. Positive engagement with our regulators continues, including new regulators in France, as we grow our licence portfolio.
The directors are committed to supporting employee development and well-being. We have appointed Wellbeing Champions, delivered training to enhance skills, notably regulatory compliance and cyber resilience, and improved communication of strategy, objectives and performance. In the coming year we look to maintain competitive compensation and enhance staff benefits. By fostering a positive and inclusive work environment, we aim to retain a motivated workforce that contributes to long-term business success.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 December 2024.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
In accordance with the Company's articles, a resolution proposing that Gravita Audit II Limited be reappointed as auditor of the Group will be put at a General Meeting.
We have audited the financial statements of BCB Group Holdings Limited (the 'parent company') and its subsidiaries (the 'Group') for the year ended 31 December 2024 which comprise the Group profit and loss account, the group statement of comprehensive income, the Group balance sheet, the Company balance sheet, the Group statement of changes in equity, the Company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the 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's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the 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
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations. The laws and regulations applicable to the Group were identified through discussions with directors and other management. Of these laws and regulations, we focused on those that we considered may have a direct material effect on the financial statements or the operations of the Company, including FCA authorised payment institution regulations, Companies Act 2006, taxation legislation, data protection, anti-bribery, anti-money-laundering, employment, environmental and health and safety legislation. The extent of compliance with these laws and regulations identified above was assessed through making enquiries of management and inspecting legal correspondence. The identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the Group’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and
understanding the design of the Company’s remuneration policies.
To address the risk of fraud through management bias and override of controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance;
enquiring of management as to actual and potential litigation and claims; and
reviewing correspondence with HMRC, relevant regulators including the FCA and the Company’s and Groups legal advisors.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at:
https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s 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 the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
As permitted by s408 Companies Act 2006, the Company has not presented its own profit and loss account and related notes. The Company’s loss for the year was £2,789,897 (2023 - £28,725,072 loss).
BCB Group Holdings Limited is a private limited company domiciled and incorporated in England and Wales. The registered office is Bloomsbury House, 74-77 Great Russell Street, London WC1B 3DA.
The Group consists of BCB Group Holdings Limited and all of its subsidiaries. The principal activity of the Group is included in the Strategic Report.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the Company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The Company is a qualifying entity for the purposes of FRS 102, being a member of a Group where the parent of that Group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group. The Company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated Group financial statements consist of the financial statements of the parent company BCB Group Holdings Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 December 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the Group.
All intra-group transactions, balances and unrealised gains on transactions between Group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the Group’s financial statements from the date that control commences until the date that control ceases.
The financial statements for the Company show a net current liability position of £4,194,735 (2023: £3,113,425) and the Group has net current assets of £4,492,208 (2023: £5,645,493). They are prepared on a going concern basis as the directors are satisfied that the Group and Company will have the resources to continue in business for the foreseeable future (which has been taken as 12 months from the date of approval of these financial statements).
In making this assessment the directors have considered a wide range of information relating to present and future market conditions, revenue and profitability forecasts and cash flow projections. These projections reflect the current balance sheet, the Group's funding plans, regulatory capital requirements and capital commitments.
As stated in note 37, subsequent to the reporting date, the Company issued a further $10m in convertible loan notes (CLNs) to its existing lead investors as part of its ongoing series B investment round. The Company’s existing investors remain supportive and discussions with prospective series B investors are positive. On this basis, the directors are confident that funding to support the Group’s growth will continue to be available.
Accordingly, at the time of approving the financial statements, the directors believe that the Group and Company have sufficient resources to continue their activities for the foreseeable future.
Revenue is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business. The fair value of consideration considers trade discounts, settlement discounts and volume rebates, and is net of any VAT or other sales related taxes.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
It is recognised when the specific criteria have been met for each of the following as described below:
Payments Segment
Set-up fees
Revenue is recognised upon provisioning customer accounts in line with signed contract agreements.
Subscription and minimum fees
Recognised on a monthly basis from customers with active accounts in line with signed contract agreements.
Transaction and related fees
Revenue is earned on transactions undertaken for customers and related services recognised on a monthly basis in arrears.
Balance fees
Revenue is earned on certain customer balances; this is recognised on a monthly basis in arrears.
Credit interest
Interest earned on BCB's own funds is recognised as interest receivable in profit or loss, using the effective interest rate method.
Markets Segment
Foreign exchange and digital currency trades
Revenue represents the net value of foreign exchange and digital currency trades. Purchases of related currency and digital currencies are netted off against turnover. Revenue is recognised after receiving the customer’s authorisation to undertake a trade.
Purchases of related currency and digital currencies are netted off against turnover. Revenue is recognised after receiving the customer’s authorisation to undertake a trade.
Purchases of foreign currency and digital currencies are recognised when a back-to-back contract is agreed with a counterparty. The Company enters into separate matched contracts with its counterparties in the majority of cases. Where trades are open at the end of a financial period, they are stated at fair value. The resulting gain or loss from the fair value movements is recorded in revenue.
Other revenues segment
Service revenue
Revenue from contracts for the provision of services is recognised by reference to the stage of completion, cost incurred and cost to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
Service fees included in the price of the product are recognised as revenue over the period during which the service is performed.
Interest earned on BCB's own funds is recognised as interest receivable in profit or loss, using the effective interest rate method.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the Group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
Digital currencies not held for resale are initially measured at cost, and subsequently carried at fair value using prices sourced from active exchanges. Changes in fair value are recognised in profit or loss. The directors are monitoring developments in accounting practice for digital assets and currencies, notably that stablecoins that are readily convertible into cash, may in future meet the tests to be treated as financial assets.
At each reporting period end date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
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 or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The Group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Group's balance sheet when the Group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets 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, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments 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 Group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.
The component parts of compound instruments issued by the Group are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangement. At the date of issue, the fair value of the liability component is estimated using the prevailing market interest rate for a similar non-convertible instrument. This amount is recorded as a liability on an amortised cost basis using the effective interest method until extinguished upon conversion or at the instrument's maturity date. The equity component is determined by deducting the amount of the liability component from the fair value of the compound instrument as a whole. This is recognised and included in equity net of income tax effects and is not subsequently remeasured.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account 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 reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
For cash-settled share-based payments, a liability is recognised for the goods and services acquired, measured initially at the fair value of the liability. At each succeeding financial reporting period end and at the date of settlement, the fair value of the liability is remeasured, with any changes in fair value recognised in profit or loss for the period.
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using an appropriate valuation methodology. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.
When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.
Cancellations or settlements are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
In cases where subsidiaries' functional currencies are different from the functional currency of the Group, the foreign currencies are translated using the following method:
assets and liabilities in foreign currencies are translated at closing rate at the date of Consolidated Statement of Financial Position;
income and expense in foreign currencies are translated at a weighted average rate for the relevant month where that provides a close approximation; and
all resulting exchange differences are recognised in the Consolidated Statement of Comprehensive Income as other comprehensive income or expense.
In the application of the Group’s accounting policies, the directors are required to make judgements, estimates and assumptions that affect the amounts reported in the balance sheet and profit and loss account. However, the nature of estimation means that actual outcomes could differ from these estimates. The accounting judgements, estimates and associated assumptions are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The following critical judgements and estimates had a significant effect on the amounts recognised in the financial statements:
a. Critical judgements in applying the Group’s accounting policies
As stated in note 1.4, the financial statements are prepared on a going concern basis. In making this assessment the directors have considered a wide range of information relating to the future. The Group operates in fast moving digital assets markets that, during 2023 and early 2024, experienced adverse market and regulatory sentiment. As a series A business, the Group’s success is dependent on revenue growth that is difficult to forecast with certainty, particularly in turbulent market conditions. The forecasts prepared by the directors have been to attempt to reflect uncertainties which the Group may face in the future. Based on these forecasts and the factoring in certain unknown future events, the directors are comfortable adopting the going concern basis.
During the financial year, a group subsidiary agreed with its banking partners for certain cash balances to accrue credit interest. As a result, these assets meet the recognition criteria under FRS 102, namely that of future economic benefits flowing to the entity and reliable measurement. However, these assets are solely held on customers’ behalf and are segregated in compliance with the FCA safeguarding regulations; they are not beneficially owned by the Group.
Nonetheless, the directors concluded that since holding safeguarded customer funds is core to the Company’s business model and that interest income was earned on these assets and reported in the profit and loss account during the financial year, their omission would not accurately reflect the Group’s operations.
Accordingly, for the financial year, safeguarded customer funds with the contractual right to credit interest, are included in cash and cash equivalents (note 18) with a corresponding liability shown in creditors falling due within one year (note 19). Credit interest earned is included in revenue as it is a primary source of income directly related to the Group’s business model.
As stated in note 17, interest payments on the €10 million loan note issued by Sutor Bank were suspended during the prior financial year. Under the terms of the loan note, the suspension of interest payments triggered an impairment review. The directors determined that the note had no value at the year end and recognised an impairment charge for the principal and interest arrears. The directors judged that the civil claim in the Hamburg Regional Court (see note 17) did not provide sufficient evidence to reduce or avoid the impairment expense in the balance sheet date. However, a partial reversal of the impairment charge was recognised in the 2024 financial year and the note was sold in 2025.
b. Key accounting estimates and assumptions
The economic lives of intangible assets are estimated at between one and five years reflecting the fast moving digital assets markets. Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.
The recoverable amount calculated in the assessment of goodwill for impairment (note 12) resulted in headroom of over £110 million. The material unobservable input assumptions were: the revenue growth rate over the assumed four years to exit, the revenue multiple on exit and the discount rate to calculate the present value.
Sensitivity analysis
The sensitivity of the carrying value of goodwill to the unobservable input assumptions is:
A 50% reduction in the average revenue growth rate of 43% would reduce the headroom in the impairment test to £40 million
A 50% reduction in the 4 x revenue exit multiple would reduce the headroom in the impairment test to £56 million
An increase in the 30% discount rate to 50% would reduce the headroom in the impairment test to £51 million.
In addition, a one year reduction in the useful economic life would reduce goodwill by £552,000.
The Company issued USD denominated convertible loan notes during the financial year. The loan notes have both equity and liability like features (note 22). The directors have split the proceeds between a financial liability and equity components, representing the fair value of the embedded option to convert the financial liability into equity. In order to calculate the liability component, the directors estimated the effective rate of interest at 21% based on a range of factors including interest rates for comparable instruments in the market.
The sensitivity of the liability and equity components to the effective rate of interest is:
A 9% increase in the interest rate would increase the equity component on issuance by £927,000 and decrease the liability by £51,000 at the balance sheet date.
A 6% decrease in the interest rate would decrease the equity component on issuance by £618,000 and increase the liability by £34,000 at the balance sheet date.
Share based payments charges are based on the difference between the fair value of the option at the date of grant and the cost of the option. As set out in note 26, the fair value of the option is determined by using the Option Pricing Model with various assumptions to calculate the value of the Company taking into account the share structure of the Company.
The inputs into the estimation of the fair value of options and growth shares granted to directors and employees are inherently uncertain. The enterprise value, share price volatility and time to liquidity are particularly challenging to estimate accurately.
Sensitivity analysis
The sensitivity of the share based payments expenses:
A 50% increase / 20% decrease in enterprise value at award would increase/decrease the expense by £137,000 / £44,000
A 20% increase/decrease in share price volatility following award would increase/decrease the expense by £142,000 / £31,000
A one year increase/decrease in the time to liquidity would increase/decrease the expense by £95,000 / £107,000
Exceptional item relates to the impairment of the long term loan and associated interest as further discussed in note 17.
The average monthly number of persons (including directors) employed by the Group and Company during the year was:
Their aggregate remuneration comprised:
The above remuneration and pension amounts relates to the four (2023: five) directors holding office during the year. The long term incentive schemes expense relates to the share based payments charge in respect of the share options and growth share plans (see note 26).
Interest earned on safeguarded customer funds is included in revenue as explained in note 1.5.
Interest payable is the interest accrued on the convertible loan notes.
Following the substantive enactment of the Finance Act 2021, effective 1 April 2023 the applicable corporation tax rate is now 25% (for companies with profits over £250,000) and continues to be 19% (for companies with profits of £50,000 or less). Companies with profits between £50,000 and £250,000 pay tax at the main rate reduced by a marginal relief providing a gradual increase in the effective Corporation Tax rate. As a result deferred tax has been calculated at 25% (2023: 23.5%).
The actual credit for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
Group
The customer contracts and goodwill were acquired as part of the acquisition of LAB577 Limited in the prior financial year. Both are amortised on a straight line basis: contracts over 12 months and goodwill over 5 years.
Goodwill was assessed for impairment at the balance sheet date since challenging market conditions and the Group's results were both indicators of potential impairment. The recoverable amount was calculated on a revenue exit multiple basis using financial budgets extrapolated with estimated growth rates, discounted to the balance sheet date at an appropriate discount rate. The recoverable amounts being in excess of the carrying amounts, there was no impairment loss to recognise. The estimation uncertainty in these calculations are further explained in note 2 above.
Company
During 2023, the Company executed its plan to transfer the business previous operated by its subsidiary, LAB577 Limited, to the Company. As a result of this movement, the carrying value of cost of investment, (which is the net of the consideration, fair value of assets on acquisition and impairment) has been transferred from fixed asset investment to goodwill as per the conditions in FRS 102 Section 19. The goodwill is subject to amortisation from the date of acquisition as per the accounting policy note.
Amortisation and impairment of intangible assets is charged to administration expenses.
Investments in subsidiaries are held at cost less impairment.
Details of the Company's subsidiaries at 31 December 2024 are as follows:
JDF Capital Limited was liquidated after the balance sheet date on 6 May 2025.
Trade debtors includes £29,759 (2023: £13,327,873) of currency and digital currency sales that had not been settled with BCB by counterparties at the balance sheet date.
In other debtors falling due after more than one year in 2023 represents a loan note issued by Sutor Bank of €10 million. The loan note is redeemable at par by the issuer from 1 July 2027. The par value of the loan note may be adjusted (reversibly) downwards based on Sutor Bank's capital adequacy. Interest is payable monthly at an annual rate of 7.5%.
During the prior financial year Sutor Bank suspended interest payments, which being an indication of impairment prompted an impairment review at the balance sheet date. On the basis that there was insufficient evidence that interest and principal would be recovered, the directors concluded that a full impairment of the loan principal and accrued interest was appropriate. An impairment release of £2,124,294 (2023: charge of £8,948,409) was charged to exceptional items (see note 4).
Group
Cash at bank and in hand at the year end, includes £361,258,103 (2023: £176,120,488) related to safeguarded customer funds. These funds are fully segregated from BCB’s own funds in safeguarding bank accounts and term deposits at high quality banking institutions and approved money market funds (MMFs) in compliance with the FCA safeguarding regulations. No safeguarded customer funds were shown at the prior year end as none were contractually eligible for credit interest during the prior year.
Trade creditors includes £173,705 (2023: £21,362,309) of currency purchases that had not been settled by the Group with counterparties at the balance sheet date.
Safeguarded customer funds are included in cash on the balance sheet in accordance with the accounting policy and key judgements (note 2a).
A loan of £2,500,000 was received from a shareholder. The loan is unsecured, bears interest at 5% per annum, and is repayable on the earlier of any of the following; company raising a specific amount of funds in share capital, a company exit, liquidation of the Company or if the Company providing notice that it wishes to repay the loan in full.
The transaction was conducted on normal commercial terms and at arm’s length.
The balance outstanding at the year-end was £2,500,000.
No guarantees were given or received in respect of this loan.
The Company issued convertible loan notes for an aggregate consideration of $7,325,000 during the financial year. The notes are redeemable at the option of the holders on 28 January 2025. Interest accrues at 6% per annum payable on redemption or conversion. The Company can require conversion upon a fund raise of $20 million or more.
The net proceeds received have been split between the financial liability element and an equity component, representing the fair value of the embedded option to convert the financial liability into equity. The equity component has been valued at £1,313,703.
The liability component is measured at amortised cost, and the difference between the carrying amount of the liability at the date of issue and the amount reported in the balance sheet represents the effective interest rate less interest paid to that date. The effective rate of interest is 21%. The equity component of the convertible loan notes has been credited to the equity reserve.
The other provisions represent the best estimates by the directors of the Company's exposure to penalties on a tax dispute in 2021.
The following are the major deferred tax liabilities and assets recognised by the Group and Company, and movements thereon:
The deferred tax credit to the profit and loss in the current year is recognised as a result of business combinations in the year.
No deferred tax asset on losses is recognised as a result of uncertain timing of using the asset.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the Group in an independently administered fund.
The Group operates share-based payment schemes for more senior employees to enable them to share in the future growth in value of the business. In the prior year, the schemes included tax advantaged and unapproved share option plans over ordinary shares. In the current year, the schemes include tax advantaged and unapproved share option plans over ordinary and ordinary 2 shares as well as a growth share plan over Z shares. All schemes related to equity instruments of the parent company.
Options are generally granted with an exercise price matching the prevailing market price of the underlying equity instrument. Options vest over three years from grant subject to continued employment by the Group and expire ten years after the date of grant. Generally, options are only exercisable upon exit subject to customary exemptions. Employees are not entitled to dividends until the options are exercised.
The Group is unable to directly measure the fair value of employee services received. Instead the fair value of the share options granted during the year was determined using an Options Pricing Model (OPM) to allocate the total equity value to individual ownership classes in the parent company's capital structure. The OPM used the Black-Scholes model to calculate the fair value of each equity tranche and option grant. The Black- Scholes model is internationally recognised as being appropriate to value employee share schemes similar to the Group's plans.
In the prior year, the parent company levied an intra-group recharge for share-based payment expense based on the directors’ estimate of the fair allocation to each subsidiary. In the current year, the parent company levied an intra-group recharge for share-based payment expense relating to the employees of each subsidiary, the cost of which offsets the capital contribution arising.
During the year, the parent company issued 167,361 (2023: 277,008) share-based options at a weighted average exercise price of £22.76 (2023: £18.98). The obligation to settle these options lies with the parent company.
The number of shares options and the weighted average price of such shares within BCB Group Holdings Limited is as follows:
In January 2022, 215,589 Series A Preferred shares of £0.0001 were issued bringing the total series A funding to £34.4m. Also in January 2022 the Company issued 338,328 Ordinary shares of £0.0001 each as part consideration for the acquisition of LAB577 Ltd, a software engineering venture studio. In June 2022, 281,578 of the warrants over Series A Preferred shares were converted into Series A Preferred shares leaving 60,000 warrants in issue.
During 2024, the Company issued 49,200 (2023: 40,000) £0.0001 Z Ordinary shares for £1.03 per share, under its growth share plan as further explained in note 26 above.
The equity component of the convertible loan notes has been credited to the equity reserve.
Group
Other reserves is made up of a Share Warrants balance of £1,057,010 (2023: £1,057,010), Share Based Payments reserves of £1,760,672 (2023: £2,074,356) and legal reserves of £8,195 (2023: £6,694).
Company
Other reserves is made up of a Share Warrants balance of £1,057,010 (2023: £1,057,010) and Share Based Payments reserves of £1,760,672 (2023: £2,074,356).
As at the Reporting Date, the Group has not recognised a provision for losses related to Authorised Push Payment (APP) fraud. This is based on the assessment that, while the Group may from time to time bear some customer losses as a gesture of goodwill or in specific circumstances, there is not currently a present obligation that meets the criteria for recognition as a provision under FRS 102. Specifically, the Group does not currently have a constructive obligation to reimburse all APP fraud victims, nor is there a consistent legal obligation that would necessitate a blanket provision for all such losses. It is not practicable to provide a reliable estimate of the financial effect of these potential future outflows at the current time, as the nature and extent of any potential future obligations are not yet sufficiently clear or reliably measurable. Any future costs related to APP fraud that the Group determines it is obligated to bear would be recognised in the period in which the obligation arises and can be reliably measured. Disclosure of this contingent liability is required as the possibility of an outflow of resources is not considered remote.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
The remuneration of key management personnel is as follows.
The directors consider all members of BCB’s Group Executive Committee (ExCo) to be key management. This committee had an average of 9 members during 2024 (2023: 9). The aggregate compensation includes non-cash share based payments expenses of £297,600 (2023: £488,908).
The following amounts were outstanding at the reporting end date:
As per note 18, cash and cash equivalents includes both own funds and customer funds which are segregated in safeguarding accounts. Total cash equals £365,116,871 of which £3,858,768 relates to own funds and £361,258,103 relates to safeguarded customer funds.
Cash and cash equivalents include safeguarded funds of £361,258,103 (2023: £176,120,488). A corresponding liability is included in trade creditors.
Series B Funding Round
In March, 2025, subsequent to the reporting date, the Company receieved a further £1.5m from shareholders in the form of a loan.
In July 2025, subsequent to the reporting date, the Company completed the sale of the loan note issued by Sutor Bank.
In September 2025, subsequent to the reporting date, the Company issued convertible loan notes (CLNs) for an aggregate consideration of $10 million. In accordance with the Company’s Compound Instrument accounting policy, the net proceeds received will be split between a financial liability element and an equity component to be recognised on the balance sheet. Interest accrues at 6% per annum payable on redemption or conversion. The CLNs automatically convert into equity upon a fund raise of $20 million or more.
These events are classified as a non-adjusting post balance sheet event under FRS 102 and, as such, the financial statements do not reflect the change in liabilities or capital or the cash inflows.