Best cryptos to own in the company’s treasury • Benzinga
Cryptocurrencies as a whole have been making a lot of noise recently, thanks to their explosive rise in value. But what are they and why would you want to get involved?
Corporate treasury is a collection of funds held by businesses – these typically include money saved by the business for large investments that cannot be postponed for more than a month. With this new market available, it’s time to think about how you might want to use cryptocurrency in your business. Whether you are looking for an investment opportunity or using it as a means of faster payments between departments, there are many benefits to investing in cryptocurrency right now.
What is corporate treasury?
Corporate cash is a way for a business to save and invest money, and these funds are generally intended for the long-term use of the company. As such, there are 2 main forms of corporate cash flow:
The first is what you might think of if someone on Twitter said, “You have to invest in cryptocurrencies.” This is when companies buy cryptocurrencies and hold them in the form of digital gold or an asset that offers dividends, interest, or other benefits. It is mainly used by large companies who can afford to invest in cryptocurrency as they can make big gains in a short period of time.
Cryptocurrency has the advantage of being an asset that can be stored off a company’s balance sheet. This means you don’t have to go through the same rigorous checks that other assets might demand. The fact that it is not held in the local currency, but rather in a digital currency, means that it is already neutral for those who wish to invest in cryptocurrencies.
There are several advantages to investing in cryptocurrency:
- Corporate cash managers can invest in cryptocurrency without having to worry about what will happen in the event of a sudden drop in prices.
- Cryptocurrencies are an internationally accepted means of payment.
- Cryptos can be automated when transactions are done automatically, and there is no need to verify transaction history.
- They can be purchased through a mobile app, so there is no need to carry large amounts of cash.
There may also be downsides to investing in cryptocurrency:
- The cost of buying and storing money is high. You spend a lot of money on security to protect your funds, which is why you have probably heard a lot about “cryptojacking”.
- There is a lack of regulation. For example, there is no standardized method by which businesses will be regulated to ensure they have sufficient security to prevent theft or fraud.
- The value of cryptocurrencies fluctuates wildly. While the actual value may be good in the short term, it might not be great if your business is looking to invest in cryptocurrency for the long term.
The main cryptocurrencies for your business treasury
There are a number of different cryptocurrencies that you may want to consider for business cash. Although the market still has a long way to go, it is making remarkable gains in its growth.
Java’s blockchain seeks to create a trusted platform for the development of financial products on a hybrid blockchain. It is already working on its flagship product, the Java Pay system, which can be used with credit cards and bank checking accounts.
Dogecoin is another digital currency designed for use in the corporate treasury space, although we have seen it used by many others online as well. It is based on the Doge digital currency, which is a popular internet meme.
Ethereum is also a cryptocurrency that can be used on the blockchain. It is known for its role as a platform for smart contracts and it is designed to give users more control over their own money.
All of these currencies offer varying benefits, so it’s up to you and your corporate treasury department to decide which one is right for you. Remember that investing in cryptocurrencies comes with risks, so keep an eye out for security first if you want to make sure your business doesn’t get burned down by this new space.
Who invests in crypto?
There is a lot of interest in the benefits of investing in cryptocurrencies – and not just corporate treasures. Here are some other notable investors in the space:
- Andrew Yang is investing $ 100 million in cryptocurrencies in his campaign for president.
- BombaPay uses blockchain technology to facilitate international payments for small businesses and has made investments with many well-known names such as JP Morgan.
- Overstock was one of the first large companies to accept Bitcoin and has been trading it since 2014. The company also uses Ethereum to process its transactions through an e-commerce site.
These are just a few of the well-known investors who are already investing in cryptocurrency. The remaining potential investors can be divided into 2 categories:
- Traditional Investors: These are investors like Warren Buffett and Bill Gates who can afford to invest in cryptocurrency. There are also those who continue to look for ways to gain a foothold in the crypto space. For example, Goldman Sachs recently announced that it is setting up an office for trading Bitcoin and other products on Bitcoin futures.
- HODLers: HODL is an acronym used by those hooked on cryptocurrency, which means ‘hold on for life’. These investors are willing to hold onto their investment and wait for it to appreciate in value – which seems like a good idea, given the volatility of the cryptocurrency market.
The advantage of crypto
There are a number of reasons why corporate treasuries might want to consider investing in cryptocurrency:
- This allows them to be part of the next generation currency. This gives them access to new technology that could also be used in e-commerce. Cryptocurrencies make transactions easier and faster than other payment methods, such as checks and wire transfers. It’s also a lot cheaper than using credit cards, which is great for international transactions.
- It ensures the transparency of transactions. The lack of transparency of traditional payment systems has fueled many frauds. With blockchain technology, transactions can be tracked to ensure that the money is going where it is supposed to go. This is particularly useful for international transactions in which a number of parties are involved.
- This allows them to track unusual spending habits. With the inflation rate consistently low in the United States, it’s not always easy for corporate treasury bills to know how much money they have and whether they are paying enough tax. With cryptocurrency, they can see the value of their investments and tax transactions in real time.
Disadvantage of crypto
Investing in cryptocurrency is not without risks:
- Risk of change: Because cryptocurrencies are a new technology, there is always a risk that they will not realize. It is difficult to predict how popular cryptocurrencies are, especially since some of them are only supported by a small group of people. This makes it impossible to estimate when the currency will become more popular and rise in value. Additionally, very few countries have regulations regarding cryptocurrency, which could lead to more fraud and money laundering.
- Volatility: It is not yet clear whether the cryptocurrency will continue to rise in value, as it has in recent years. Although cryptocurrencies offer great potential, they are still very new and could be affected by external factors. This investment is extremely volatile, which means that a corporate treasury can see its investment decrease in value at any time.
Investments are never guaranteed, so it’s important to carefully consider all of your options before making a decision. This is especially true for cryptocurrency investments, which can be dangerous due to their volatility.
Frequently Asked Questions
Which cryptocurrency will explode in 2021?
Which cryptocurrency will explode in 2021?
Ryan McNamara, Co-Chair, Wolverine Blockchain
It is impossible to predict which cryptocurrency will explode in 2021 as they are extremely new and volatile. There are some promising options, including Bitcoin, Litecoin, and Ripple. However, it is best to do your own research before making any investment decisions.
How far will cryptocurrency prices go?
How much will cryptocurrency prices go up?
Ryan McNamara, Co-Chair, Wolverine Blockchain
With cryptocurrencies only starting to gain popularity over the past few years, many experts believe the market is still insanely thin. This means that when the market becomes more popular and more people start investing, the prices could go up even higher than they are today. It is important to do your own research before making any investment decisions.
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