Possible Bitcoin treasury adoption as more companies cite inflation concerns

Published at: April 27, 2021

No fewer than 47 companies have cited the term “inflation” in their earnings calls for Q1 2021.

According to a report by financial market data provider FactSet on Monday, the figure represents the highest number of companies to do so in the last decade.

Earlier in April, the United States Bureau of Labor Statistics released its “Producer Price Index” report showing a 4.2% year-on-year increase in PPI, the highest since September 2011.

While Federal Reserve chairman Jerome Powell continues to argue that current inflation and consumer price index numbers are only temporary, there is a counter-argument that businesses will move to transfer the burden of greater production costs to their consumers.

Meanwhile, companies may also be seeking ways to protect their cash reserves from U.S. dollar debasement following the nearly $6 trillion in stimulus money poured into the U.S. economy over the course of the ongoing coronavirus pandemic.

Back in August 2020, business intelligence outfit MicroStrategy made headlines when it announced its first Bitcoin (BTC) purchase. Michael Saylor’s firm now holds over 90,000 BTC valued at more than $5 billion, with the asset up almost five-fold since August 2020.

On Monday, Tesla announced the sale of $272 million worth of Bitcoin — about 10% of its BTC holdings — in the company’s Q1 financial report. According to Tesla’s Q1 2021 earnings call, the electronic vehicle maker netted $101 million in net profit from the sale.

Tesla first revealed its BTC ownership back in February, announcing that it has purchased about $1.5 billion worth of Bitcoin.

With inflation expected to continue in its upward trajectory at least in the short term, more U.S. companies might convert some of their cash reserves to Bitcoin. This likelihood is despite arguments to the contrary made by treasury experts back in February.

Back in March, Dawn Fitzpatrick, chief investment officer of Soros Fund Management, said that BTC was no longer a fringe asset on account of U.S. dollar debasement.

Tags
Adoption
Bitcoin
Business
USA
Inflation
Dollar
Related Posts
Billionaire investor Carl Icahn thinks Bitcoin may be the best hedge for inflation
Billionaire investor Carl Icahn warned Tuesday that the next market crisis may be on the horizon, and Bitcoin (BTC) could be the best hedge against inflation. With the United States government continuing to stimulate the economy, Icahn stated that he fears the U.S. dollar is becoming more devalued and that the price of goods is rising. “In the long run, we are certainly going to hit the wall. I really think there will be a crisis the way we are going, the way we are printing money, the way we are going into inflation. If you look around you, you …
Adoption / Oct. 19, 2021
Mass adoption looms as South America's second-largest company accepts crypto payments
On April 28, MercadoLibre (MELI), the largest Latin American online marketplace, launched a real estate section dedicated to cryptocurrencies. Although the company does not settle property transactions directly, it legitimizes the category as a payment system. The $81 billion retailer is the second largest company in South America and is present in 18 countries, including its three largest markets, Brazil, Argentina, and Mexico. The group also owns Mercado Pago, a digital payments system for online and offline transactions, along with Mercado Envios, a logistics platform that provides fulfillment, warehousing, and shipping services. The current offers include houses, condos, vacant lots, …
Adoption / April 29, 2021
How long will the crypto bear market last? Raoul Pal's macro analysis
Macro investor Raoul Pal is convinced that the current crypto bear market will end only once the Fed eases its hawkish monetary policy by halting interest rate hikes. That could happen in the next couple of months, according to Pal's predictions. “The Fed are unlikely to raise rates as far and as fast as people expect. My guess is they probably stop raising rates sometime in the summer and that will be it,” he said in an exclusive interview with Cointelegraph. Pal sees the combination of high interest rates and fear of an upcoming recession as the main macro factors …
Adoption / May 12, 2022
5 reasons why Bitcoin could be a better long-term investment than gold
The emergence of forty-year high inflation readings and the increasingly dire-looking global economy has prompted many financial analysts to recommend investing in gold to protect against volatility and a possible decline in the value of the United States dollar. For years, crypto traders have referred to Bitcoin (BTC) as “digital gold,” but is it actually a better investment than gold? Let’s take a look at some of the conventional arguments investors cite when praising gold as an investment and why Bitcoin might be an even better long-term option. Value retention One of the most common reasons to buy both gold …
Adoption / June 3, 2022
Bitcoin could hit $10M in 9 years but more sidechains needed: Blockstream CEO
Blockstream CEO Adam Back believes the price of Bitcoin (BTC) could reach $10 million by the end of the sixth halvening in 2032, as long as Bitcoin layer-2 technology and wallet infrastructure improves. In a Feb. 12 Twitter thread, Back, one of the contributors to Bitcoin core, was explaining to his 509,000 followers in what situation Hal Finney’s $10 million price prediction for BTC could come true. He noted that BTC has doubled in price year-on-year on average since 2013 and explained that if that trend continues, BTC price would reach $10M along with a $200 trillion market cap in …
Adoption / Feb. 13, 2023