Nigel Farage, the Reform UK leader facing a standards probe over an undeclared £5m gift from a crypto billionaire, is the second largest shareholder in Stack BTC, a bitcoin treasury company he has advertised. The company has lost more than 15% of its asset value, prompting finance experts to warn investors against such firms.
Farage invested £215,000 in Stack BTC, which buys bitcoin on behalf of shareholders and aims to purchase other companies with the value increase from holding bitcoin. However, the company's investments have fallen 15.48% since its launch in March this year, resulting in a loss of £565,000.
Liberal Democrats Call for Ban on MPs Promoting Financial Products
The Liberal Democrats have called for MPs to be banned from “flogging” specific financial services and products. A Lib Dem spokesperson said: “People should be cautious about buying shares in Farage. His stock is only heading one way.”
A Reform spokesperson said Farage did not have a brand-ambassador role at Stack BTC but had simply bought shares. However, Farage appeared in a promotional video earlier this year showing him spending £2m of the company’s money on bitcoin.
Farage's Shareholding and Company Structure
The largest shareholder in Stack BTC is Paul Withers, who also owns gold dealer Direct Bullion. Withers' company paid Farage £270,000 for 12 hours’ work promoting the company. Withers owns 20.72% of Stack BTC shares, followed by Farage at 5.61%. The pair are the only two with enough shares (5%) to have voting rights. Kwasi Kwarteng, the former Conservative cabinet minister, is the executive chair and owns 3.55% of shares.
Experts Warn Against Volatile Investments
Susannah Streeter, chief investment strategist at Wealth Club, said: “Such a steep fall in value shows just how brutally volatile these assets remain and companies that simply stack up bitcoin holdings have no diversification cushion to soften the blow when prices turn.” She cautioned against investing in companies endorsed by public figures, adding: “It can give an investment a veneer of legitimacy the underlying asset doesn’t deserve.”
Peter Schiff, the US stockbroker who correctly predicted the 2008 financial crash, said: “I like Nigel Farage, but I would advise against investing in any bitcoin treasury company.” He added that politicians promote these companies because they “are trying to get votes from people who own bitcoin”.
Dan Coatsworth, head of markets at AJ Bell, said: “If you look back at Stack BTC’s history, the company has changed its name multiple times, which could be a red flag. So far, Stack BTC has nothing to show but a series of ill-timed bitcoin investments.”
Political Scrutiny and Standards Probe
Farage and his party have called for deregulation of cryptocurrency and proposed a “bitcoin reserve fund”. His interest in crypto came under scrutiny after he received a £5m undisclosed gift from crypto billionaire Christopher Harborne, leading to a standards probe for failing to declare it.
Lisa Smart MP, the Lib Dem Cabinet Office spokesperson, said: “It’s a disgrace that whilst the country grapples with the cost of living crisis, Nigel Farage is busy encouraging people to put money into what could be highly risky crypto investments.” Stack BTC declined to comment.
