Cryptocurrencies are continuing to gain steam…
At the New York Times DealBook conference earlier this month, Apple (AAPL) CEO Tim Cook said that he owns Bitcoin (BTC) and Ethereum (ETH).
According to CNBC, Cook noted that he believes digital coins such as BTC are not only reasonable to own, but also help to diversify portfolios.
Even so, he said that this interest was more on a personal level rather than something Apple is considering as a company.
But Apple should definitely join the ranks of Tesla (TSLA), Square (SQ), and MicroStrategy (MSTR) in holding Bitcoin on its balance sheets…
First, it would likely result in greater demand for the company’s shares, as many investors are looking for exposure to BTC while also limiting the risk associated with buying the coin outright.
Meanwhile, there are balance sheet benefits to holding digital assets as well. As it stands, many institutional adopters say BTC could help drive returns and preserve companies’ capital over time.
In fact, Cathie Wood from Ark Invest predicts that Bitcoin should reach $500,000 per coin in 5 years time if more companies put just 5% of their balance sheets into BTC.
Apple has a massive $191 billion cash position just sitting on its balance sheet doing little-to-nothing right now.
One could rather easily argue that Apple should put at least 5% of that (about $9.5 billion) into Bitcoin as a hedge against inflation to fulfill its fiduciary responsibility to its shareholders. Otherwise, that money is just going to continue losing purchasing power over time…
Bitcoin is seen as a natural hedge against inflation and volatility among global currencies, as there will only ever be 21 million BTC in existence and the rate of new Bitcoin mined decreases daily.
You see, Bitcoin is deflationary global money that’s seen by millions areadly to the solution to inflation in fiat currencies caused by too much money printing globally.
And given the fact that many companies are now accepting it as a form of payment, it suggests that we’ll likely see a broader adoption of cryptocurrencies moving forward. As this trend grows, demand for companies like Apple to have crypto-payment services will increase as well.
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