Abra Unveils Abra Treasury, Offering Corporates a Platform for Crypto Reserves
By Ruholamin Haqshanas
Updated: July 1, 2024, 08:01 EDT
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2 min read
Abra, a leading digital asset prime services and wealth management platform, has introduced Abra Treasury. This new service is tailored for corporations that wish to hold cryptocurrencies as reserve assets on their balance sheets.
In a Monday press release, Abra announced that Abra Treasury will offer a full spectrum of digital asset treasury management solutions for corporates, family offices, and non-profits. The service is managed by Abra Capital Management, an SEC-registered investment advisor, and includes custody, trading, borrowing, and yield services. It enables clients to securely store their cryptocurrencies in separately managed accounts, maintaining ownership and control over their digital assets.
Corporate Treasurers Turn to Bitcoin
The current macroeconomic landscape, marked by rising inflation and geopolitical instability, has driven corporate treasurers to consider Bitcoin (BTC) as a reserve asset. MicroStrategy (MSTR), a Nasdaq-listed software company led by Michael Saylor, holds the largest corporate Bitcoin reserve with 226,331 tokens amassed since 2020.
Marissa Kim, Head of Asset Management at Abra Capital Management, noted the increasing interest from non-crypto-native businesses in Bitcoin as a treasury reserve asset. She observed a growing number of small to medium-sized enterprises, especially in real estate, exploring BTC purchases for their treasuries or using BTC as collateral for business and real estate projects. “We are increasingly seeing clients that are business owners and CEOs of small to medium-sized businesses (SMBs), in particular real estate companies, with interest in buying BTC for their treasury or borrowing against BTC to finance business needs or real estate projects, which we did not see last cycle.”
Recently, Abra and its founder and CEO, William “Bill” Barhydt, reached a settlement with 25 state financial regulators. The agreement, announced by the Conference of State Bank Supervisors (CSBS), requires Abra to reimburse up to $82.1 million in cryptocurrency to customers in the settling states.
Metaplanet Adopts MicroStrategy’s Bitcoin Approach
Inspired by MicroStrategy’s successful Bitcoin strategy, other public companies are considering adding Bitcoin to their balance sheets. In April, Metaplanet announced its decision to incorporate Bitcoin into its treasury assets. The company aims to reduce its exposure to the Japanese yen, which has been adversely affected by Japan’s low-interest-rate environment. In a shareholder update, Metaplanet emphasized Bitcoin’s potential as a hedge against inflation, a tool for macroeconomic resilience, and a means of achieving long-term capital appreciation.
Major corporate investors in Bitcoin, including MicroStrategy, have already seen substantial profits. According to data from Saylortracker, with Bitcoin’s current market price around $67,000, MicroStrategy’s holdings are valued at over $14.59 billion. This results in significant unrealized profits of almost $6.5 billion, reflecting an impressive gain of nearly 104% year-to-date from an investment strategy initiated by Saylor in 2020.
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