Growing numbers of traditional businesses are beginning to explore digital assets in their corporate treasury strategy, indicating a paradigm shift in business’ perception of crypto as a tool for 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 allocation to digital tokens, like Bitcoin.BTCIt is a cryptocurrency that can be used to buy XRP.XRPSolanaSOL).
Nature’s Miracle (an agricultural technology company) announced that it will be launching a new product on Wednesday. announced The XRP would receive up to 20 million dollars.XRPIt is the latest company to switch to a corporate treasury. altcoin treasury strategy.
Upexi, a manufacturer of consumer goods. disclosed The purchase of 83,000 SOLSOLThe company also announced that it would be donating a, worth $16.7 million to its corporate treasurer on the same day.
Kitabo is a Japanese publicly-listed company that specializes in textiles, recycling and other related industries. revealed Plans to purchase Bitcoin worth $5.6million or 800 million Japanese Yuen for the company’s reserve.
You can also find out more about the following: 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 Crypto treasury firms are gaining popularity.
Related: Trump’s Bitcoin mentor bet on BTC treasury strategies — and his wealth is exploding
The risks associated with the increasing trend towards crypto-treasury firms
The crypto-holding firms include Bitcoin treasury companiesAnalysts say that cryptocurrencies are subject to a number of legal and financial risks, which could lead to the implosion of these companies.
The only way to get a few Bitcoin treasury companies will surviveAccording to an 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 dwindling 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 is a content creator, community member and member of the Viktor 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
