Big corporates are already here in the Bitcoin space. There is a long list of publicly traded companies who are holding Bitcoin (BTC). A public company is a company that has sold all or a portion of itself to the public via an initial public offering. The main advantage public companies have is their ability to tap the financial markets by selling stock (equity) or bonds (debt) to raise capital (i.e., cash) for expansion and other projects.
Generally, due to the requirement of large amounts of capital, privately held companies opt to become public after fulfilling all regulatory requirements.
By going public, a company provides liquidity for its shareholders. When a company grows, its major shareholders may wish to cash in on the wealth they have tied up in the business. The public offer creates a market for the company’s shares that gives investors the ability to sell their holdings.
Why do companies invest in Bitcoin? Businesses should have the money to manage the day-to-day business obligations. Treasury is involved in the management of the money and financial risks of a business process. Ensuring there is sufficient capital will help in the long-term financial strategy and policies of the company.
Cryptocurrency is looked at as a new avenue for enhancing a host of more traditional Treasury activities, like simple, real-time, and secure money transfers. Holding Bitcoin for long protects the treasury from the side effects of volatility and it also provides the advantages of increase in price of BTC. Treasuries work like mini-banks and holding bitcoin is priced up to meet the liabilities in asset generation activities. Thus, Bitcoin liquidity helps strengthen control over the capital of the enterprise. Bitcoin is believed to help with the overall cash position of the companies, thus being armed with sufficient cash for the daily operations of the business.
Elon Musk: “Tesla sold 10% of its holdings essentially to prove liquidity of Bitcoin as an alternative to holding cash on balance sheet.”
Thus, it has already been proven at an enterprise level that Bitcoin can be an alternative to hold cash on Balance Sheet.
More than 26 publicly traded companies hold Bitcoin (BTC) on their Balance Sheet.
The industry to which these companies belong are from sectors like software, automobile, crypto investment firm, financial services, crypto mining, crypto exchange, traditional investment firm, financial services and insurance.
Dan hold a master of finance from the ISEG (France) , Dan is also a Fan of cryptocurrencies and mining. Send a tip to: 0x4C6D67705aF449f0C0102D4C7C693ad4A64926e9
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