Canadian firm Matador Technologies is taking a page out of the playbook of many crypto payments companies by incorporating Bitcoin into its treasury. The decision was made on December 23 and was unanimously endorsed by the board of directors. It's certainly a bold step in the world of cryptocurrency asset management.
The Risks of Being Too Canadian
Matador’s current treasury is pretty much all in Canadian dollars, and they’ve realized that isn’t great for their long-term stability. With Canada heavily dependent on oil exports and the national debt rising, there’s a clear risk of devaluation and loss of purchasing power. In light of that, they are diversifying by adding Bitcoin and US dollar-denominated assets to their treasury.
"Canada’s reliance on oil exports and its rising national debt raise concerns about potential devaluation and loss of purchasing power for Canadian-denominated assets", they stated.
Initial Steps and Future Plans
Initially, Matador plans to drop a cool $4.5 million into Bitcoin in December. But don’t think that’s all they’re doing; they intend to keep looking into more purchases through board-approved buying programs. Plus, they’ll be converting most of their cash from Canadian to US dollars.
Sunny Ray, the company’s President, made a statement about the move:
"Matador’s Board and management believe in using Bitcoin to future-proof our treasury. This step also supports our mission to explore using Bitcoin as a platform for our gold-based products."
Developing Digital Gold
A key reason for this decision is to support the launch of Matador's digital gold platform next year. That’s right, they’re looking to create a system where people can buy, trade, and store tokenized gold backed by physical reserves. By supporting Bitcoin with their treasury, they’re hoping to enhance security and efficiency, which is something every crypto asset manager knows is vital.
The Bigger Picture
Matador is not the only company that’s made a similar move. A bunch of other firms have also decided to embrace Bitcoin as a strategic reserve. For example, Quantum BioPharma recently disclosed buying $1 million worth of Bitcoin and other crypto assets. Another company, Jiva Technologies, approved a plan to buy $1 million of Bitcoin, and video platform Rumble announced it would allocate up to $20 million of its excess cash reserves to Bitcoin.
This growing trend among companies suggests that Bitcoin is seen as a hedge against currency risks and a means of diversifying their asset bases. But let’s be real, Bitcoin is also still a volatile asset, and that can create some interesting challenges—and opportunities.
The Takeaway
It’s clear that Matador Technologies is making a big bet on Bitcoin as part of its long-term financial strategy. By recognizing the risks of being overly reliant on the Canadian dollar and leveraging blockchain technology, they are positioning themselves for potential future growth. As more firms jump on the Bitcoin bandwagon, this could very well shift the corporate treasury landscape.
