Meliuz, a Brazilian fintech, has initiated a strategy to invest part of its cash reserves in bitcoin, leading to a 25% increase in its shares. The firm aims to allocate up to 10% of its cash in bitcoin, having already purchased 45.72 bitcoins. This decision reflects a broader trend in the corporate world to explore alternative assets for long-term returns, despite potential volatility risks.
Brazilian fintech Meliuz has introduced a strategy to allocate a portion of its cash reserves into bitcoin, potentially making it a primary treasury asset. Following this announcement, Meliuz’s shares surged over 25%. The firm aims for long-term returns from these investments, drawing inspiration from prominent holders such as U.S.-based MicroStrategy and Japan’s Metaplanet.
Meliuz plans to invest up to 10% of its cash reserves in bitcoin, having acquired 45.72 bitcoins for approximately $4.1 million. Founded in 2011, Meliuz began with cashback services for online retailers, evolving to include physical retail, app services, digital accounts, and credit cards. After its public listing in late 2020, Meliuz’s stock faced challenges due to Brazil’s high interest rates but currently maintains a net cash position exceeding 240 million reais ($41.72 million).
Meliuz Chairman Israel Salmen remarked on the strategic importance of this move, stating that relying solely on fixed-income investments could incur significant opportunity costs. He believes this strategy will not only bolster the company’s financial standing but also position it as a leader in the ongoing global financial transformation.
The company plans to carry out an in-depth evaluation regarding bitcoin’s potential role as the main strategic treasury asset. UBS BB analysts highlighted Meliuz’s innovative approach, noting it aligns with a rising global trend of exploring alternative assets. They noted, “If successful, the strategy might set Meliuz apart in attracting investors interested in crypto exposure, though it may also introduce higher volatility in outcomes.”
Meliuz’s strategic pivot to incorporate bitcoin into its treasury aims to enhance its long-term returns and financial stability, reflecting a broader trend among companies seeking alternative assets. The company’s bold move could potentially distinguish it in the investment landscape, but may also introduce risks in terms of volatility. This approach not only serves Meliuz’s current cash management strategies but could also position it as a pioneer in the global financial shift towards cryptocurrency investment.
Original Source: www.usnews.com
