GM “Review of adoption as a means of payment”
Twitter “Contemplating Investing”
Verizon “will bring you risk”
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Electric car maker Tesla, led by Elon Musk, announced that it would buy 1.5 billion dollars (about 1.7 trillion won) worth of bitcoin with corporate funds, and also allow payment of its products with virtual assets (cryptocurrency). It’s getting deeper.
This is because the number of cases of companies that had large amounts of bitcoin hit the “jackpot” as the bitcoin market surged to $49,000 (about 54 million won) as the virtual asset market continued to benefit from last year and this year.
U.S. MicroStrategy,’Bitcoin Confidence’,’stock price surged 10 times’ in 5 months
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MicroStrategy, an IT (information technology) consulting company listed on NASDAQ in the United States, is a representative example of a significant increase in corporate value by “absorbing” 80% of its cash assets in bitcoin.
MicroStrategy started investing in bitcoins in August of last year and currently owns 71,079 bitcoins, which amounted to KRW 3.724.7 trillion as of the 13th. Considering that MicroStrategy’s average purchase price of bitcoin is $16,109 (KRW 1,770,000), compared to the current market price ($47,268), it recorded a 193% return in just a few months.
The valuation gain obtained from the investment in bitcoin amounted to $2,2414.7 million (about 2,445.9 billion won). Considering that MicroStrategy’s 2019 operating profit was $486 million (536.7 billion won), it means that it earned five years of operating profit from about six months of bitcoin investment.
As the value of the bitcoin it owned jumped, the stock price of MicroStrategy also surged. MicroStrategy’s stock price, which remained around $120 in the middle of last year, surged to $1312 as of the end of this week, rising more than 10 times. In particular, a global financial company Morgan Stanley acquired 10.9% of MicroStrategy shares, or 79,2629 shares, fueled the surge in stock prices earlier this year.
Michael Sailor, CEO of MicroStrategy, said, “Companies that have fiat currencies such as euros and dollars on their corporate balance sheets lose about 15% of their purchasing power every year.” “There are some simple solutions to solve this. “Investing cash in Bitcoin.”
Large companies, direct investment is usually NO… ‘YES’ for the use of related companies’ purchase and settlement system
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Many companies, led by MicroStrategy and Tesla, have started investing in bitcoin, but the chief financial officers (CFOs) of major global companies are generally skeptical about investing directly in virtual assets such as bitcoin. However, it is known that they are looking for a’detour’ such as buying a virtual asset-related company or reviewing the introduction of a virtual asset payment system.
In an interview with CNBC on the 10th, CEO Mary Barra of US automaker General Motors (GM) said, “We have no plans to invest directly in Bitcoin.” “However, we will continue to monitor customer demand over whether to adopt virtual assets as a payment method for services and vehicle purchases,” he said.
PayPal, the world’s largest online payment company, which recently introduced virtual asset payment, said it will not directly purchase virtual assets with cash. John Rainey, CFO of PayPal, said, “We are not going to invest directly in the company’s cash in virtual assets, but we want to take advantage of the rapidly growing virtual asset market as an opportunity.”
“Bitcoin isn’t worth adding to the balance sheet,” said Roxy Wen, CFO of Mozilla, developer of the web browser Firefox. I took a somewhat neutral attitude.
“There are currently no plans to adopt a bitcoin payment method,” said Matthew Ellis, CFO of Verizon, the largest mobile telecommunications company in the United States. “Investing in bitcoin will bring a risk to the balance sheet.”
Scott Heran, CFO of Cisco Systems, said, “Customers don’t want Bitcoin payments,” he said. “When I was at Autodesk, we discussed whether to adopt a bitcoin payment method, but due to risks such as volatility, we did not push forward.”
“Twitter is considering adding bitcoin to the balance sheet,” said Ned Segal, Twitter CFO. “If employees ask for a payroll in bitcoin, they could consider investing in bitcoin as a reserve asset for a corporation. In this case, we “We are considering whether we should put Bitcoin on our balance sheet, how we can pay it, etc.”
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