Wall Street analysts have warned executives at other major companies about possible forays of bitcoin during recent earnings conference calls.
“We have no plans to invest in bitcoin, so full stop,” she said in response to a question from Morgan Stanley automotive analyst Adam Jonas.
But she has not ruled out the possibility that customers may one day buy Chevrolets, Buicks or Cadilllacs with cryptocurrency – just as Tesla is planning to allow customers to use bitcoin to buy their electric cars and trucks.
“This is something that we will monitor and evaluate. And if there is a strong demand from customers for this in the future, there is nothing to stop us from doing this,” added Barra.
But executives at other companies, especially financial companies, are not convinced that bitcoin should be part of their cash management strategies.
“My understanding is that currently accounting is different from other currencies and can create more volatility,” he added.
Volatility is a problem. Large price swings are likely to prevent other large companies from putting corporate money into bitcoin.
Of course, the payoff has been huge lately. But companies want stability from their corporate investments – not an asset that fluctuated from a minimum of just over $ 4,000 to almost $ 50,000 last year.
Diving into encryption
Other companies are willing to take the risk.
But he differentiated between assets like bitcoin and so-called stable currencies that are supported by existing government currencies. Kelly said that bitcoin and other cryptocurrencies are more like “digital gold”.
“They are predominantly held as assets that are not used as a significant form of payment at this time,” said Kelly, adding that “fiat-backed digital currencies, including stable currencies and central bank digital currencies .. are an emerging innovation in payments that could have the potential to be used in global trade. ”
In other words, the Tesla purchase may prompt more companies to consider buying bitcoin, but it is not likely to create a massive wave of support yet.
The biggest wildcard
RBC analyst Mitch Steves said in a report earlier this month that if Apple decided to open its own cryptocurrency business (potentially through its Apple Wallet feature), then Apple “could immediately gain market share and disrupt the industry. ”
Based on how much money Square gets from bitcoin-related revenue, Steves estimates that Apple could generate more than $ 40 billion in bitcoin-related revenue.
He also noted that Apple could finance any bitcoin exchange plan by adding about $ 1 billion to its balance sheet, saying that a purchase of bitcoin by Apple would help validate it further and that “the price of the underlying asset would increase substantially. “
Apple has not publicly discussed any bitcoin investment plans and the company has not responded to requests for comment.