Key Points
- Matador’s Board of Directors have approved the inclusion of Bitcoin and USD assets in its corporate treasury.
- The move aims to protect the company’s financial resources and hedge against currency risk.
Matador, a firm that employs blockchain technology to digitize real-world assets like gold, has made public that its Board of Directors has unanimously agreed to incorporate Bitcoin and USD-denominated assets into its corporate treasury. This move is a strategic attempt to safeguard and manage the company’s financial resources in the long run.
This decision was made after the Board of Directors identified the risks of holding the majority of its treasury in Canadian dollars. They cited concerns such as Canada’s reliance on oil exports and increasing national debt, which could potentially lead to currency devaluation. Matador has committed to allocate $4.5 million to Bitcoin in December 2024, with the possibility of increasing this amount in the future.
Matador’s Strategic Shift to Bitcoin
The company also intends to transition most of its cash balance sheet from CAD to USD, viewing Bitcoin as a value store to protect against currency devaluation. This shift towards digital currency by Matador aligns with the trend among leading institutions now adopting Bitcoin as a safeguard against depreciating fiat currencies.
Matador President Sunny Ray expressed that the board and management see Bitcoin as a means to secure their treasury for the future and support their objective of incorporating Bitcoin into their gold-based products.
Bitcoin’s Role in Matador’s Financial Future
The integration of Bitcoin will expedite the development and launch of Matador’s gold platform. This platform will allow users to own, trade, and store digital gold backed by physical reserves held at the Royal Canadian Mint. It was stated that these reserves would aid in supporting product development and enhancing investor trust in the company’s treasury strategy.
The decision to prioritize Bitcoin over other digital assets was made after reviewing other platforms such as Ethereum and Solana. The deep liquidity of Bitcoin and its increasing adoption by top institutions make it a superior choice compared to other digital assets, making it the ideal choice for Matador’s digital gold platform.
Matador’s CEO, Deven Soni, mentioned that Bitcoin is the optimal choice for their product, which emphasizes trust, permanence, and value. The Board will evaluate other technology options and decide by the first quarter of 2025 which platform will support its digital gold product. Following this, Matador plans to launch the product to a limited audience and keep shareholders informed about their treasury and custody plans.
