Japanese games publisher Nexon announced allocating $100 million for the purchase of 1,717 Bitcoins. According to the official press release, the company bought the digital currency at an average price of roughly $58,226 per BTC, inclusive of fees and expenses.
Additionally, purchase amounts to approximately 2% of Nexon’s total cash and cash equivalents on hand as of December 2020.
Owen Mahoney, President, and CEO of the online game provider had explained that the company’s purchase of the crypto-asset mirrors a “disciplined” strategy for protecting shareholder value. The exec also stressed the move was taken to maintain the purchasing power of the firm’s cash assets. Mahoney views Bitcoin as a form of cash that is likely to retain its value at times like inflation, even if it is not yet widely recognized. He also went on to add that,
“In the current economic environment, we believe Bitcoin offers long-term stability and liquidity while maintaining the value of our cash for future investments”
Why Is Nexon Buying Bitcoin A Crucial Development?
With this development, Nexon joins the likes of Tesla and other technology firms such as Square Inc. to have embraced the digital currency this season. It happens to be the first large public company in Japan as well as South Korea to buy cryptocurrency as part of its treasury.
However, this is not the first time a major Japanese company has dipped its toes into the realm. Tokyo-based financial service firm, SBI had revealed that its plans to roll out bank-backed digital currency exchange. Back in 2017, the country’s GMO Internet Group had also unveiled a $3 million investment into Bitcoin mining.
According to Steve Jang, the Founder and Managing Partner at Kindred Ventures Nexon’s strategy has generated from the need for a currency hedge, rather than investment speculation. Jang also noted that this is an important driver of adoption by companies and financial institutions, which could potentially bring stronger hands to develop the store-of-value use case across the world.
The exec also added,
“Nexon is a gaming platform exploring the multiverse possibilities and what virtual goods mean in a crypto world. organizational learning takes time and needs to permeate from many angles. the board’s move to invest in BTC can only help stoke that product exploration in gaming”
According to Bitcoin Treasuries‘ latest stats, currently, there are 35 publicly traded companies that are holding the cryptocurrency on their balance sheets.