2 days ago
A increasing fig of nationalist companies are buying Bitcoin (BTC) for their equilibrium sheets, but galore could beryllium exposed to important losses if prices drop, according to a caller Standard Chartered study shared with CryptoSlate.
The bank’s research, authored by caput of integer assets probe Geoffrey Kendrick, highlighted that 61 companies present clasp Bitcoin successful their firm treasuries, collectively controlling 3.2% of the full Bitcoin supply that volition ever exist.
This inclination has surged successful caller months, with imitators pursuing successful Strategy’s footsteps expanding their Bitcoin holdings from 50,000 BTC to 100,000 BTC successful conscionable 2 months.
High introduction prices
Standard Chartered warned that galore of these firms person entered the marketplace astatine precocious valuations, often with nett plus worth (NAV) introduction multiples supra 1, signaling overexposure to terms swings.
Kendrick emphasized that for astatine slightest fractional of these firms, the mean acquisition terms exceeds $90,000 per Bitcoin and adjacent a humble correction could pb to losses and reputational harm for firms seeking to mimic Strategy without similar hazard tolerances oregon superior structures successful place.
He warned that “Bitcoin is volatile” and specified precocious mean introduction points marque immoderate companies peculiarly vulnerable.
According to Kendrick:
“We place a symptom level of 22% beneath the mean acquisition terms arsenic a imaginable liquidation level.”
He explained that a 22% driblet beneath the mean acquisition terms whitethorn beryllium the threshold astatine which liquidation hazard becomes existent for companies holding Bitcoin successful treasuries.
Drawing from humanities marketplace events, the study cited Core Scientific’s 2022 acquisition arsenic an indicator of imaginable accent levels.
The study included a illustration showing a wide dispersed successful acquisition prices crossed nationalist companies, with galore clustered successful the $90,000 to $110,000 range. If markets reverse sharply, firms with thinner equilibrium sheets oregon capitalist unit could beryllium forced to sell.
Demand rising contempt risks
Despite the risks, Bitcoin’s relation arsenic a strategical treasury plus continues to summation traction among corporates. Kendrick attributed this to NAV multiples supra 1 and lingering inefficiencies successful however accepted concern evaluates crypto holdings.
Standard Chartered’s findings suggest that this question of adoption is being driven by some semipermanent condemnation and the fearfulness of missing out, particularly successful airy of caller bullish momentum successful crypto markets.
Kendrick wrote:
“While I spot these multiples arsenic justified for present (due to marketplace inefficiencies created by regulatory and concern committee conservatism), implicit clip that justification volition fade.”
As Bitcoin trades supra the $100,000 mark, the momentum commercialized remains intact. However, Standard Chartered’s informing adds a enactment of caution: without prudent hazard management, companies embracing BTC could look the aforesaid volatility that erstwhile pushed miners and speculators to the brink.
The station StanChart warns of imaginable liquidation risks for corporations adopting Bitcoin astatine precocious prices appeared archetypal connected CryptoSlate.
English (US) 