Companies buy Bitcoin through a governed treasury process rather than a retail app. The usual sequence is board approval, a written policy, onboarding with regulated counterparties, execution through an OTC desk or exchange, settlement into institutional custody, and recording the holding for accounting and audit. Each step has its own controls, and the trade itself is often the shortest part.
Overview: how companies buy Bitcoin
| Step | What happens | Who is involved |
|---|---|---|
| 1. Approval | Board approves strategy, size and policy | Board, CFO, audit committee |
| 2. Preparation | Accounting, tax and custody design agreed | Finance, auditors, advisers |
| 3. Onboarding | KYB and AML checks with counterparties | Treasury, compliance |
| 4. Execution | Quotes obtained, trade agreed | Treasury, OTC desk or exchange |
| 5. Settlement | Cash paid, Bitcoin delivered | Treasury, counterparty, custodian |
| 6. Custody | Bitcoin secured under signing policy | Custodian, authorised signers |
| 7. Reporting | Holding recorded and disclosed | Finance, auditors |
Before the trade: approval, preparation and onboarding
Step 1: Get board approval
No company should buy Bitcoin on a single executive's decision. The board should approve the purpose, the maximum size, the funding source and the treasury policy that governs the holding. Board papers should include a stress test and the accounting impact. See how to get board approval for Bitcoin.
Step 2: Prepare accounting, tax and custody
Before the first trade, the finance team should agree three things.
- Accounting. Under US GAAP, ASU 2023-08 measures Bitcoin at fair value through net income. Under IFRS, holdings are generally intangible assets under IAS 38. Agree the treatment and cost basis method with auditors.
- Tax. Treatment varies by jurisdiction. Companies should take their own tax and legal advice.
- Custody. Decide where the Bitcoin will be held, who can authorise movements, and how recovery works. Our guide to corporate Bitcoin custody sets out the options.
Step 3: Onboard with counterparties
Institutional counterparties carry out know-your-business (KYB) and anti-money-laundering checks. Expect to provide:
- Corporate registration documents and constitutional documents.
- Details of directors, shareholders and ultimate beneficial owners.
- Board resolution authorising the purchase and named signatories.
- Source of funds information.
- Bank account details for settlement.
Transfers between virtual asset service providers fall under the FATF Travel Rule (Recommendation 16), so counterparties will also collect and share originator and beneficiary information. Onboarding can take days or weeks, so start early.
Step 4: Executing the trade
This is where order size matters most.
Small orders.
Modest amounts can be bought on an institutional exchange account. The trade fills against the public order book.
Large orders.
For large purchases, most companies use an OTC desk. Instead of placing an order on a public book, the company requests a quote for a fixed quantity, and the desk prices it as a single block. This limits slippage and avoids signalling the order to the market. See what is a Bitcoin OTC desk? and OTC vs exchange execution.
Execution methods.
- Request for quote (RFQ): the company asks one or more desks for a firm price and accepts the best.
- Block trade: one large trade at an agreed price.
- TWAP or VWAP: the order is worked over hours or days to reduce market impact.
- Tranches: the total allocation is bought in stages over weeks or months.
The right method depends on size, urgency and market conditions. Requesting competing quotes and recording them gives the board evidence of best execution.
CFO tip: get at least two firm quotes for any large order, at the same time, and file them with the trade confirmation. Auditors and boards will ask how the price was achieved.
After the trade: settlement, custody and reporting
Step 5: Settle the trade
Settlement is the exchange of cash for Bitcoin. Two models are common:
- Pre-funded: the company sends cash first; the counterparty then delivers Bitcoin.
- Delivery versus payment or credit-based: settlement happens simultaneously, or the counterparty extends short-term credit.
Each model carries different counterparty risk. The company should understand who holds whose assets, and for how long, at each point. See settlement and counterparty risk.
Step 6: Secure the Bitcoin in custody
Once delivered, the Bitcoin should move promptly into the company's chosen custody arrangement. Before any large transfer, many treasury teams send a small test transaction to confirm the receiving address. Signing policies should require more than one authorised person to approve movements.
Step 7: Record and report
The finance team records the purchase at cost, then measures it according to the applicable framework. Under ASU 2023-08, that means fair value at each reporting date, with disclosures of holdings, cost basis, restrictions and a roll-forward. Keep trade confirmations, quotes, settlement records and custody statements together for the audit file.
Common mistakes
- Executing a large order on an exchange order book and paying for slippage.
- Leaving custody design until after the trade has settled.
- Starting onboarding too late and rushing the approval chain.
- Failing to evidence best execution.
- Sending the full amount without a test transaction.
How The Bitcoin World helps
We plan the whole purchase process with finance teams: approvals, onboarding, execution strategy, liquidity sourcing and custody architecture. Execution, custody and settlement are carried out by licensed third-party institutions; we do not hold client assets or trade on our own account. See our OTC liquidity and custody architecture services.