Méliuz, a Brazilian fintech, has allocated 10% of its cash reserves, amounting to $4.1 million, into bitcoin, marking it as the first publicly traded company in Brazil to implement a bitcoin treasury strategy. The move is intended for long-term investment returns and aims to engage investors amidst declining stock values.
Méliuz, a Brazilian fintech company, has recently made headlines by allocating 10% of its cash reserves, equivalent to $4.1 million, into bitcoin. This strategic move renders Méliuz the first publicly traded firm in Brazil to adopt a bitcoin treasury strategy, acquiring 45.72 bitcoins at an average price of $90,926 each, as per the approval of its board of directors.
The company articulated that this bitcoin allocation aims for “long-term returns” as part of its treasury management approach. Furthermore, it has established a Bitcoin Strategic Committee tasked with exploring ways to enhance its strategy, potentially positioning bitcoin as a primary treasury asset, which indicates a significant shift in their financial management.
Méliuz Chairman Israel Salmen conveyed optimism regarding the transition into bitcoin, identifying it as an “intelligent alternative” to traditional cash reserves. He emphasized the perception of bitcoin as a long-term store of value amidst current economic conditions.
By holding $4.1 million of bitcoin, Méliuz joins the ranks of U.S. firms like MicroStrategy, known for its substantial bitcoin investments. Méliuz provides cashback and financial services to over 30 million users across Brazil, although its stock valuation has declined from nearly $6 billion in 2021 to about $270 million.
Salmen noted that the company’s low trading volume has led to its shares being perceived as “irrelevant” in public markets. He remains hopeful that their pioneering bitcoin strategy will reignite investor interest, especially as Brazil’s bitcoin and cryptocurrency market continues to grow, having traded over $200 billion last year. Méliuz anticipates that its investment in bitcoin will yield better long-term returns compared to Brazil’s prevailing benchmark interest rate of 13.75%.
In summary, Méliuz’s adoption of a bitcoin treasury strategy marks a pivotal moment for publicly traded firms in Brazil. The company’s decision to allocate a substantial portion of its cash reserves into bitcoin reflects a shift towards innovative financial strategies aimed at enhancing long-term returns. With the creation of a dedicated committee to oversee this initiative, Méliuz seeks to position itself as a leader in Brazil’s expanding cryptocurrency landscape.
Original Source: bitcoinmagazine.com
