NFT

Treasury Policies & Processes for Crypto Transactions

Report date: 
26 Jan 2023

Commentary

This call took place five days after FTX filed for bankruptcy. However our discussion did not dwell on crypto as an investment (We haven't found a treasurer who would). The interest for treasurers is to help their companies understand the business opportunities of the metaverse, and that isn’t going away.

According to Gartner,’ [https://www.gartner.com/en/articles/what-is-a-metaverse] by 2026, 25% of people will spend at least one hour per day in a metaverse for work, shopping, education, social media and/or entertainment’, and…’A metaverse is not device-independent, nor owned by a single vendor. It is an independent virtual economy, enabled by digital currencies and non-fungible tokens (NFTs).’

So it's no surprise that many companies are developing strategies to capitalise on what could be a massive business opportunity. Participants in this call comprised treasurers representing companies at different stages of this journey, all facing the challenge that the regulatory and financial infrastructure available is at an early stage of evolution.

  • About half of the participants are still investigating the use of crypto and exploring how it works in case it does evolve within their businesses, but still not necessarily wanting to accept crypto or handle crypto within treasury operations.
  • Risk management to enable safe use in Corporate Treasury remains paramount and it isn’t easy.
  • We are seeing continued evolution around the NFT space and using crypto for settlement. But it continues to be quite limited.
  • Accounting requirements for how crypto currencies are handled are still not clear and not necessarily sustainable for the future. Regulations are going to evolve.
  • It is fascinating to hear, for the first time, crypto working capital
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Accepting Crypto Currency in Corporate Treasury

Report date: 
15 Jan 2022

Commentary

Following the CompleXCountries call ‘Accepting Bitcoin in Corporate Treasury – Lessons from El Salvador’, (Report Here), the CXC community clearly did not see this as a one off.  The necessity to accept  Bitcoin & Crypto may become a reality for more Treasurers, but the path is far from being very clear. The purpose of this call was to share experiences and challenges, and learn from the various solutions Treasurers are putting in place if they have to accept crypto currency to support their businesses. 

The session was extremely insightful and even if a Corporate is not accepting Crypto now, this report required reading for the Treasury community.  It is a challenge that will increasingly become more common as corporations drive more digital sales channels.   The regulated Crypto exchanges have seen significant growth over the last few years and the ability to exchange fiat for crypto and back to fiat has become widely available in the marketplace. 

We posed the questions:  is this something that they have had to deal with or are going to have to deal with in the future? El Salvador was a first newsworthy case but on this call we gained insight to how it is  becoming more mainstream in digital businesses and therefore becoming far more common for corporates around the world.

Non Fungible Token (NFT) Definition. “A unique digital certificate, registered in a blockchain, that is used to record ownership of an asset such as an artwork or a collectible.” Collins Dictionary, who picked ‘NFT’ as their word of the year 2021.

To summarise the key learning points:

Consumer businesses are targeting digital native consumers who are increasingly.....please sign in to continue reading

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