If you hate losing money, then you’re not alone—no one likes it, especially giant corporations. But in these challenging financial times, it seems as though losing money is inevitable.
Companies spend big bucks to stay in the black, and following the economic disaster that was 2020, the financial sector is uncertain for a lot of players in the game. This uncertainty has led to unprecedented measures to hedge against potential loss in the current economic climate. One such measure is to put their bank in Bitcoin. Bitcoin has grown far beyond its meager beginnings back in 2011, and corporations are taking notice. A steadily growing list of major players has boarded the Bitcoin train as of late.
At the top of the list is MicroStrategy, which has now put ALL of its cash into Bitcoin—a whopping $425 million, to be precise. MicroStrategy is in the business intelligence industry, and CEO Michael Saylor, who was once critical of Bitcoin, has managed to convert the entirety of MicroStrategy’s cash into Bitcoin. “On September 14, 2020, MicroStrategy completed its acquisition of 16,796 additional bitcoins at an aggregate purchase price of $175 million. To date, we have purchased a total of 38,250 bitcoins at an aggregate purchase price of $425 million, inclusive of fees and expenses,” Tweeted Saylor on September 15 of last year. MicroStrategy is arguably the loudest institutional proponent for Bitcoin, and after the Bitcoin Summit 2021 set to take place Wednesday, February 3rd, a lot more corporations are likely to follow suit.
Electric car company CEO Elon Musk has made no secret of his support for bitcoin.
“I do at this point think bitcoin is a good thing, and I am a supporter of bitcoin,” Musk said. Now Musk continues to flaunt his affinity for the cryptocurrency by announcing that Tesla may be adding bitcoin to its books.
Musk sparked buzz around Tesla jumping in bed with bitcoin in a response to MicroStrategy CEO Michael Saylor on Twitter.
“If you want to do your shareholders a $100 billion favor, convert the [Tesla] balance sheet from [dollars] to [bitcoin].”
To which Musk responded:
“Are such large transactions even possible?”
Musk has now changed his tune on Twitter, posting pro-bitcoin tweets, highlighting the possibility for Tesla to buy into Bitcoin. And should Tesla convert its cash assets to Bitcoin, it would pump another $6.2 billion into the bitcoin space, at least.
The list of Bitcoin supporters continues to grow and doesn’t seem to be stopping anytime soon. As more and more companies join in, the more stable will be Bitcoin’s price action, which will then lead to more investors seeking financial refuge with Bitcoin as a viable reserve asset.
Square, the payments platform, announced last year that the company had invested 1% of its assets in Bitcoin. That amounts to 4,709 Bitcoin, or roughly $50 million. “Bitcoin has the potential to be a more ubiquitous currency in the future,” Square says. And to that effect, Square has added Bitcoin payments to its major mobile payment platform Cash App. But Square’s not just limiting their crypto involvement to investing. The payment giant also contributes to Bitcoin open-source work via Square Crypto, which started in 2019. All their Bitcoin involvement has been paying off, as Square reported Bitcoin revenue of nearly $306 in May of last year.
Contributed by Garrett S.