Canadian augmented reality firm NexTech AR Solutions is preparing to become the latest company to use part of its treasury reserve to buy bitcoin. NexTech AR plans to buy $2 million worth of the cryptocurrency.
The firm joins several others deciding to hedge their reserves with BTC. Purchases by firms such as MicroStrategy appear to have also kickstarted the recent bullish price action.
Another Company Chooses Bitcoin to Protect its Wealth
The turbulent global economic picture this year has inspired yet another company to protect its wealth in bitcoin. According to a Tuesday press release, the Vancouver-based augmented reality firm said it would make an initial investment of $2 million.
The Canadian company also says it may buy more bitcoin at a later date. Evan Gappelberg, NexTech AR’s CEO, commented on the decision:
“This initial investment reflects our belief that Bitcoin is a long-term store of value and an attractive investment asset with more long-term appreciation potential than holding cash, which is currently yielding 0.06%”
Gappelberg added that bitcoin is emerging as a digital alternative to gold. Drawing comparisons between gold’s $10 trillion market cap and bitcoin’s $500 million, the CEO commented that bitcoin had more room to grow.
The Year of the Corporate BTC Investment
NexTech AR is the latest in a series of companies buying BTC with their treasury reserves. Earlier in 2020, MicroStrategy stunned cryptocurrency industry observers with a significant investment.
Starting August, the firm announced several purchases that culminated in the sale of $650 million worth of convertible senior notes. The proceeds were spent on more bitcoin, taking the firm’s total holdings above $1 billion.
Following MicroStrategy was Jack Dorsey’s payments company Square. In October, it bought $50 million worth of BTC using its reserves.
Later still, Massachusetts-based life insurer MassMutual announced its own investment. The almost 170-year-old company diversified $100 million of its more than $275 billion assets under management (AUM) into bitcoin earlier this month.
A New Breed of Investor Sending BTC to New Highs?
MicroStrategy’s first bold BTC buy in August appears to have inspired a new wave of corporate bitcoin hodlers. Those announcing similar purchases all cite fear of a weakening dollar depreciating their reserves.
The growth of institutional buying may have coincided with recent price action that has witnessed BTC move into the mid $20,000 – $30,000 area. Bitcoin traded below $12,000 when MicroStrategy announced its first purchase.
Over the next four months, the price has increased by more than 135%. At the time of writing, BTC trades around $26,800, not far from its recent all-time high of $28,335 set on Dec. 27.
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content.