As part of corporate treasury, a growing number of companies have begun to use digital assets. This is a sign of a change in the way businesses see crypto in terms of financial management.
In the past week, businesses from diverse sectors such as consumer goods, agriculture and a Japanese textile firm that is nearly 80 years old have announced their allocations of tokens, including Bitcoin.BTCIt is a cryptocurrency that can be used to buy XRP.XRPSolanaSOL).
Nature’s Miracle is an agricultural technology firm that announced on Wednesday its latest product, the Nature’s Miracle Agricultural Technology Company. announced It would be possible to allocate as much as $20 million towards an XRP.XRPThe company is one of the latest to adopt an altcoin treasury strategy.
Upexi, a manufacturer of consumer goods. disclosed Purchase of 83,000 SOLSOLAlso on Wednesday, the company received a, valued at $16.7 millions, to be placed in its corporate Treasury.
Kitabo is a Japanese publicly-listed company that specializes in textiles, recycling and other related industries. revealed The company plans to purchase 800,000,000 Japanese Yen (approximately $5.6 Million) of Bitcoin as a reserve.
It is important to note that the word “you” means “you”. rise of Bitcoin treasury companies The expansion of corporate Treasury options has seen many companies consider digital assets as part of their treasury strategy. Analysts warn that the risks are increasing as the trend continues to grow. market and investment risks The crypto-treasury industry is booming.
Related: Trump’s Bitcoin mentor bet on BTC treasury strategies — and his wealth is exploding
Crypto treasury company risks
Companies that hold crypto holdings include Bitcoin treasury companiesAnalysts say that there are several risks to the legal system and markets, which could lead to the implosion of these companies. This would have a negative impact on other crypto-markets.
Just a few Bitcoin treasury companies will surviveAccording to a report from June report Breed Venture Capital is a venture capital firm.
Authors of the report argue that even a minimal drop in Bitcoin price can trigger a downward spiral for BTC companies who are over leveraged. They would then be forced to liquidate their BTC to pay off debt obligations. This could lead to a cycle of falling prices and drying up corporate credit.
Companies that hold digital assets could be included. face costly investor lawsuits If traditional financial measures like stock prices fall or crypto markets are not performing, then you should be concerned.
Altcoin holdings companies are a source of additional risk, as they hold assets with high inflation rates that may experience a 90% drop in value between cycles. These assets can also peak at peaks during one market cycle.
“Altcoins have no floor and thus are cooked once ‘the music stops,’ whereas the BTC treasury companies have a floor, and this floor is independent of them, and it tends to go up with time,” Viktor, a community member who is also a creator of content wrote On X.
Magazine: ‘China’s MicroStrategy’ Meitu sells all its Bitcoin and Ethereum: Asia Express
“This article is not financial advice.”
“Always do your own research before making any type of investment.”
“ItsDailyCrypto is not responsible for any activities you perform outside ItsDailyCrypto.”
Source: cointelegraph.com
