Business Bitcoin adoption grows by 30% in a year: River

A new report suggests a considerable shift in corporate treasury strategies, with Bitcoin expected to have more influence in the future.

A Bitcoin technology company, River, estimates that in the next 18 months, around 10% of all U.S. companies will convert 1.5% of their cash reserves to BTC. This conversion could be of the order of $10.35 billion, which constitutes an extreme shift away from conventional financial practices.

The research, entitled “Why Business Bitcoin Adoption Grew by 30% in 1 Year,” points to various factors as the reason for this. Since 2020, companies allocating 3% of their reserves to BTC have demonstrated better capacity to withstand inflation. This is in contrast to those relying solely on cash and short-term equivalents.

Key findings from the report show that publicly traded companies holding Bitcoin increased by 40% from September 2023 to August 2024. In the near future, daily Bitcoin holdings in the BTC range will grow from 204 to 519 BTC until 2026. It will be worth between $12.2 and $31.1 million at $60,000 per BTC. The market has recorded a better liquidity, with the daily trading volumes above $10 billion.

The recent regulatory updates, for example, the FASB’s change of December 2023, that allow the Bitcoin fair value recognition of the holding. At the same time, mainstream financial institutions offer BTC products, which consequently make it easier for large investors to enter the market.

Current Bitcoin holdings vs. cash reserves

The report also mentions that companies based in the U.S. currently have approximately $19.7 billion in BTC. This is only a small part of U.S. businesses’ $6.9 trillion cash reserves. However, the level up of the trend is confirmed even though the adoption is still in its early stages.

A survey of River’s business partners showed that 95% plan to add more BTC to their portfolio in the future. However, dealings with and taxation are still the main worries for companies looking to start using Bitcoin.

As Bitcoin approaches its 16th anniversary, its role in corporate treasury strategies keeps on changing. The report also claims that businesses owning Bitcoin will have greater chances to protect their capital, overcome recession periods, and increase their liquidity in the increasingly digital world.