- US companies will convert 1.5% of their treasury reserves to Bitcoin.
- Companies could adopt Microstrategy’s Bitcoin investment model.
- There is a 52.29% chance the US economy will go into a recession by July 2025.
US-based Bitcoin technology and financial services firm, River, forecasts that 10% of US companies will allocate 1.5% of their treasury reserves, roughly $10.35 billion, to Bitcoin within the next 18 months. This prediction comes as concerns rise about a potential US economic recession by July 2025.
River’s analysts argue that traditional corporate treasury strategies, reliant on cash and short-term equivalents, often fail to outpace inflation, leading to a decrease in value. They point to Apple’s $15 billion loss in treasury holdings as an example of this inflationary erosion.
Microstrategy’s Bitcoin Model
The report highlights Microstrategy’s corporate treasury strategy, which involves converting a substantial portion of its assets to Bitcoin. In June, the Michael Saylor-led company completed an $800 million debt sale, using the proceeds to purchase an additional 11,931 BTC.
Microstrategy’s Bitcoin strategy reflects the company’s strong belief in the digital asset. Saylor has repeatedly emphasized Bitcoin’s potential as an investment, calling it an asset that ensures “economic immortality.” He believes Bitcoin’s capped supply and lack of counterparty risk make it an ideal choice for safeguarding investments and preserving wealth.
Economic Recession Looms in the US
Current projections show a 52.29% chance of the US economy entering another recession by July 2025. This figure is slightly higher than previous month’s estimates but lower than the January 2025 projection of 61.47%.
Recession fears heightened in the US in early August following the release of weaker-than-expected job reports. The report triggered a rapid market selloff amid slowing job growth and rising unemployment. However, subsequent reports appeared more promising, with a rebound in the equity markets.
In the meantime, the US Federal Reserve is adopting measures to stem the threat caused by rising inflation and address the issue of unemployment. Analysts predict the Fed will cut interest rates in the next FOMC meeting while attempting to spur the economy and fight against the looming recession.
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