Every business leader is aware of the need to safeguard their company’s capital, and conventional wisdom dictates they should invest in a mix of traditional assets like bonds and stocks to protect against economic volatility.
But this isn’t the only option for ambitious business executives, for a new paradigm has emerged that involves stockpiling digital assets such as Bitcoin and Ethereum. That doesn’t mean engaging in speculative trading. Rather, these crypto treasuries represent a more sophisticated attempt by businesses to diversify their assets, and they can provide substantial advantages over traditional investments.
Notable companies with established crypto treasuries include Elon Musk’s Tesla Inc., Michael Saylor’s Strategy Inc. and the online performance marketing firm SharpLink Gaming. Strategy is believed to hold 640,250 BTC (worth around $72 billion), a truly humongous amount representing 3% of the total supply, while SharpLink has become one of the biggest Ethereum “whales” of all, amassing over 740,000 ETH, worth more than $3.04 billion at today’s prices.
Some executives might balk at the idea of holding crypto assets, and not just because of their volatile nature. The process of buying, selling and managing crypto securely is not for the faint-hearted, especially anyone who is new to dealing in digital assets. But that’s where concierge trading platforms like On-Demand Trading can make a difference. With its white-glove service, businesses don’t need any in-depth technical know-how to get to grips with crypto.
Why Create A Crypto Treasury?
First and foremost, crypto can be an excellent hedge against possible inflation. The economy today is notoriously unpredictable thanks to the uncertainty of U.S. trade policies and the on-and-off-again prospect of heavy tariffs. And inflation continues to be a challenge in many countries.
Bitcoin, with its supply capped at just 21 million coins, is designed to be anti-inflationary, and although its value moves up and down, anyone who zooms out and looks at the long-term picture will see that it has been on a steady upward trajectory for years. In fact, it has been rising ever since it was first created in 2009. There’s a good reason why Bitcoin is considered a “store of value”, and by holding it over the long term, businesses can hedge against inflation and benefit from its future appreciation.
Crypto treasuries can also be justified by the need for businesses to diversify their asset base as much as possible. In fact, some would argue that crypto is one of the best ways to do this, because the market doesn’t always correlate with traditional assets. Oftentimes, when the stock market is down, other assets will be down too, but crypto stays strong. There have been many instances in the past where the value of crypto assets has jumped at a time when other markets feel the heat. By holding a portion of their wealth in crypto, businesses can stabilize the value of their portfolios during moments of volatility.
Executives may also consider exploring the unique opportunities in decentralized finance that can only be accessed with crypto. DeFi protocols provide numerous ways for companies to generate yield, for instance, by staking, lending, or providing capital to liquidity pools to earn rewards. Crypto can also be used to invest in tokenized real-world assets that span everything from real estate to renewable energy to uranium.
A Strategic Trading Partner
Businesses might be wary of entering the crypto realm, and that’s understandable. For instance, a company that’s involved in recycling used car parts or manufacturing washing machines is unlikely to know too much about buying and selling crypto. But technical knowledge is not required when engaging with specialized crypto trading platforms like On-Demand Trading.
Unlike traditional crypto exchange platforms, where users have to do everything themselves, On-Demand Trading offers a concierge experience for every customer and is especially suited to corporate clients. It’s like customer support on steroids – whereas other platforms just direct their users to their FAQ pages and online guides, On-Demand Trading assigns each client a dedicated account manager who can be accessed via chat. They are real humans, and it is their job to guide customers throughout the crypto trading process.
Customers simply tell their account manager what they want to buy or sell, and they’ll be quoted a price, which they can either accept or decline. If they agree, On-Demand Trading provides wire transfer instructions, and the trade will be executed at that price on the same day. Repeat customers and larger volume trades can obtain discounted rates.
In fact, it’s more like engaging with a consultant than trading on a platform, with dedicated account managers working with businesses to help them craft customized strategies for their crypto treasuries, based on their level of risk tolerance, investment horizons and financial objectives.
Security is another area where On-Demand Trading excels, thanks to its robust compliance frameworks, multi-signature wallets and institutional-grade cold storage. Account managers can help companies to navigate whatever regulatory complexities they may face, with detailed transaction reporting to ensure they’re operating in full compliance.
Final Thoughts
Creating a crypto treasury can be a smart move, but the smartest businesses won’t let this distract them from their core operations. Rather than looking for a crypto platform, they’ll find a strategic partner that’s able to handle all of the intricacies of their digital asset investments, leaving them free to focus on growing their business.
