BitStil platform (reviewed here) published news about Bitcoin as an asset for being safe from inflation. It’s very confusing for many investors to see current BTC price and recent dump (read more in previous article) but still most of analysts continue consider bitcoin as a relatively good hedge asset against inflationary fiat money..
*Few day ago BitStil website appeared to have some issues with website access from some regions of the world.. I received around 11 requests from different users of this platform and I myself also couldn’t access it.. As an alternative way to access the website i used TOR browser – where it worked fine as usual.. At the same time, mirror website created by the admin, but no any news update about that was posted yet (only the note on the website).. So i advice to try to use TOR browser if you have any troubles to access it, until this is fixed. Hopefully admin will bring us more information and news about that soon..
Meanwhile, here is the news:
Bitcoin, as an alternative to cash on the balance sheet, saves companies from inflation.Firms with iconoclastic leaders, like Musk and Dorsey, “would be the most likely to take the plunge” and commit sizable cash balances to crypto.As corporate finance leaders prepare to set sail into the post-COVID-19 world amid inflation storm warnings, an increasing number of corporations are taking stock of their treasury reserve holdings. If the worst happens, and the dollar and other reserve currencies weaken, are they sure that all their balance-sheet cash is lashed down securely?It surely hasn’t escaped their notice, after all, that a number of public companies that “joined” Bitcoin (BTC) in a big way over the past year recently broadcast strong Q1 2021 earnings. Square, which holds $472 million worth of BTC, for instance, reported a quarterly gross profit increase of 79% year-over-year, doubling analysts’ expectations. While Tesla, which plunked down $1.5 billion — 8% of its cash — into BTC in February, posted record earnings with revenues surging 74%. MicroStrategy, which made Bitcoin its primary corporate reserve in 2020, notched a 10% gain in Q1 revenues.“If inflation picks up, or even if it doesn’t, and more companies decide to diversify some small portion of their cash balances into bitcoin instead of cash, then the current relative trickle into bitcoin would become a torrent,” wrote storied investor Bill Miller in a market letter earlier this year. Already, “companies such as Square, MassMutual, and MicroStrategy have moved cash into bitcoin rather than have guaranteed losses on cash held on their balance sheet,” he added.Elsewhere, Ark Investments commented in a company newsletter: “Microstrategy, Square, and now Tesla are showing public companies the way to add bitcoin as a legitimate alternative to cash on their balance sheets.”Overall, what does this say about the global economy if public firms now look to a 12-year-old digital currency to keep its cash stockpiles liquid and secure?A longer-term trend or seasonal fashion?“I do not view this as a fad,” Paul Cappelli, a portfolio manager at Galaxy Fund Management, told Cointelegraph. Bitcoin’s “inelastic supply curve and deflationary issuance schedule” make it a “compelling hedge against inflation and poor monetary policies that could lead to cash positions becoming devalued over time,” he told Cointelegraph, predicting:“Corporations will continue to use Bitcoin as one of the tools available to preserve the value of their balance sheets.”David Grider, lead digital asset strategist at Fundstrat, informed Cointelegraph that as crypto becomes more mainstream, he expects to see “more corporates holding crypto for legitimate business purposes.” Exchanges could hold it as inventory, tech companies might use it to stake tokens and participate in networks, while multinational corporations could accept it for payments.“I expect two types of companies to consider early adoption of crypto — ones led by leaders who are strong believers in crypto, as well as companies that may have unique cross-border needs that are a good fit for Bitcoin transfers,” Gil Luria, director of research at D.A. Davidson & Co., told Cointelegraph.If so, doesn’t this represent a sea change for corporate finance officers? “When I did my treasury exams, the thing we were told as number one objective is to guarantee security and liquidity of the balance sheet,” Graham Robinson, a partner in international tax and treasury at PricewaterhouseCoopers and adviser to the United Kingdom’s Association for Corporate Treasurers, told Reuters. BTC with its volatility might simply not fit the bill.If Bitcoin were to be used as a corporate treasury reserve, and its price plunged, that company might not be able to meet its working capital requirements, noted Robert Willens, adjunct professor of Columbia Business School, in January, when he described it as “a high-risk, high-reward strategy.”Has Willens changed his views? “I still believe it is a high risk/high reward strategy,” he told Cointelegraph, acknowledging that “lately, the rewards have far outweighed the risks.” He does see more firms following the lead of Tesla and Square, “as crypto investments become more ‘respectable’ and emerge as a viable outlet for corporate cash balances.” Asked who might lead the way, Willens answered:“I think companies with iconoclastic leaders — not necessarily confined to a particular industry — would be the most likely to take the plunge and commit a decent amount of the corporation’s cash balances in crypto.”Fundstrat’s Grider, citing the OTC trading firm Genesis’ Capital trading data, told Cointelegraph that more corporations may be buying crypto than has been reported in earnings statements. The Genesis Q1 2021 “Market Observations Report,” for example, reported a striking jump in “corporates’” share of crypto trading volume to 27% from 0% in the quarters prior. “As corporate clients began buying bitcoin for their treasuries in Q1, our ratios shifted,” noted Genesis.Join BitStil and bring your life quality to a whole new level!
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