Smaller publicly listed companies are taking a leaf out of MicroStrategy’s revolutionary playbook by adopting the company’s popular Bitcoin treasury strategy. And one has added its own twist by also adding Ripple’s native coin XRP to its balance sheet.
Worksport To Incorporate BTC And XRP Into Its Corporate Treasury
Worksport, a New York-based company that trades on the Nasdaq and sells pickup truck covers, announced Thursday that it was investing up to 10% of its cash reserves in Bitcoin and XRP. This is equivalent to $5 million.
The decision to buy up these two cryptocurrencies is intended to safeguard Worksport’s assets against inflation and to boost transaction efficiency.
Worksport CEO Steven Rossi described Bitcoin and XRP as “increasingly reliable stores of value” due to their “inflation-resistant” properties.
Apart from adding BTC and XRP to its corporate treasury, the company said it would also accept crypto for payments on its e-commerce platform. Worksport expects a 37% reduction in transaction costs with cryptocurrency payments.
“By strategically allocating a portion of our treasury to these digital assets and accepting crypto payments, we’re enhancing our financial strategy and aligning ourselves with the future of global finance,” Rossi noted.
Why XRP?
Worksport joins a growing list of publicly traded companies that have taken the plunge and used excess cash reserves to purchase digital assets this year.
Michael Saylor’s MicroStrategy was the first public company to put BTC on its balance sheet back in 2020, in an effort to accrue the best returns for shareholders instead of holding excess cash. The software firm now holds a staggering 402,100 BTC, worth around $39 billion at the coin’s current market price.
However, it’s extremely rare for firms to opt for altcoins such as XRP.
Rossi, who has personally invested in XRP, shared his belief in the industry’s third-largest cryptocurrency by market cap during an interview.
“XRP has been doing quite well recently, and it reaffirmed that these are early assets that really challenge central banking,” he posited. While XRP has registered some extreme volatility, the Worksport boss believes it’s stabilizing and will bring long-term value.
Besides the spectacular price rally, the fact that there’s also a handful of spot XRP exchange-traded fund applications on the SEC’s desk might also make the digital asset more appealing for corporate adoption.
