Méliuz has become the first publicly traded company in Brazil to allocate 10% of its cash reserves into bitcoin, investing $4.1 million to acquire 45.72 bitcoins. This strategic move aims for long-term returns and reflects a broader trend in corporate finance, mirroring U.S. firms like MicroStrategy. The company hopes this initiative will ignite renewed interest in its stock amidst a declining valuation.
Méliuz, a prominent Brazilian fintech company, has officially proclaimed its strategic allocation of 10% of its cash reserves into bitcoin. This initiative marks a significant milestone, as Méliuz is now the first publicly traded entity in Brazil to implement a bitcoin treasury strategy. The firm invested $4.1 million to acquire 45.72 bitcoins at an average price of $90,926 per coin, reflecting a substantial commitment to this cryptocurrency.
The allocation of bitcoin is intended to pursue long-term returns as part of Méliuz’s treasury management approach. In conjunction with this investment, the company has established a Bitcoin Strategic Committee tasked with exploring further expansion of its cryptocurrency strategy, aiming to position bitcoin as a key treasury asset.
The Chairman of Méliuz, Israel Salmen, expressed that the transition to bitcoin serves as an “intelligent alternative” to traditional cash reserves. He asserted, “We see bitcoin as a long-term store of value,” indicating confidence in the cryptocurrency’s potential.
With this acquisition, Méliuz joins the ranks of U.S. firms like MicroStrategy, which has amassed over 500,000 bitcoins. This move reflects an emerging trend wherein companies diversify their balance sheets through digital currencies. Despite the current valuation of Méliuz’s stock plummeting from nearly $6 billion in 2021 to approximately $270 million, the initiative aims to rejuvenate investor interest amidst dwindling trading volumes.
The Brazilian cryptocurrency sector is rapidly evolving, with more than $200 billion traded in the previous year. Méliuz anticipates that its investment in bitcoin will yield greater long-term returns compared to Brazil’s prevailing benchmark interest rate of 13.75%.
Méliuz’s decision to invest in bitcoin epitomizes a notable shift in corporate finance within Brazil, highlighting innovative approaches to asset management. This pioneering strategy is expected to provide long-term financial benefits, potentially re-engaging investors and contributing to the growth of Brazil’s burgeoning cryptocurrency market. By leading the way as a publicly traded company adopting a bitcoin treasury strategy, Méliuz sets a precedent for others in the industry.
Original Source: bitcoinmagazine.com
