A treasury policy turns “we are interested in Bitcoin” into a set of rules that survive a change of staff, a bad month and an audit. If you write only one document before buying anything, write this one. It should fit on a page.
Who this is for
Finance leaders, CFOs and treasurers preparing a proposal for their board, and the executives who sponsor it.
The eight sections of the policy
- Purpose. State why the company holds Bitcoin in one or two sentences, for example “to diversify part of long-term reserves against loss of purchasing power”. If you cannot say why, do not proceed.
- Scope. Define what the policy covers: which entity, which funds. State clearly that operating cash and short-term liquidity are excluded.
- Allocation limits. Set a maximum share of reserves, and say how it is measured. Illustrative example: no more than 5 percent of treasury reserves, reviewed each quarter. Your figure must come from your own cash flow stress test, not from this page.
- Approved ways to buy. Name the approved venues and counterparties, the method (for example gradual purchases over a set period) and who may instruct them.
- Custody. Say how and where the asset is held, how many approvals are needed to move it and who holds the keys. See our custody guide.
- Authority and approvals. Who can propose, who must approve, which amounts need board sign-off. Keep proposers and approvers separate.
- Risk limits and triggers. Define what happens if the position falls by a set percentage, exceeds the cap or a custodian’s status changes. Write the action in advance so that nobody improvises under stress.
- Reporting and review. State what is reported to the board and how often, how the holding is valued, and when the policy itself is reviewed.
A short worked example
A company holds six months of operating costs as cash. It decides that excess reserves above twelve months of costs are the only pool from which Bitcoin may be bought, capped at a small share of that excess. Purchases are made monthly for a year so that no single day determines the outcome. Funds are held under a three-of-five approval structure. If the position exceeds the cap because of price gains, the policy requires the board to decide whether to rebalance. Everything in the example is illustrative; the structure, not the numbers, is what to copy.
Common mistakes
- Setting an allocation by enthusiasm rather than by stress-testing.
- Mixing operating cash with the Bitcoin pool.
- No exit rule, so the first sharp fall becomes a crisis meeting.
- One person controlling everything.
- Writing the policy once and never reviewing it.
Checklist before you take it to the board
- Purpose stated in plain language
- Allocation cap based on a stress test of our own numbers
- Custody and approval structure defined
- Triggers and responses written down
- Reporting and review dates set
- Reviewed by legal and by finance
