Bitcoin as part of a company's cash reserves - smart diversification or risky speculation?

During my vacation, I looked into this question and gained interesting insights into our monetary system in the two books "The Fiat Standard" and "The Bitcoin Standard" by Saifedean Ammous.

In times of inflation, negative interest rates and geopolitical uncertainty, many companies and wealthy individuals are asking themselves how they can put high cash reserves to good use. One option that is increasingly being discussed is investing in Bitcoin. But is this a wise decision?

Pro Bitcoin investment: protection against currency devaluation

Proponents see Bitcoin as "digital gold" - a scarce commodity with a fixed maximum quantity of 21 million units. In an environment in which central banks are constantly printing money, Bitcoin appears to be a potential hedge against inflation. In addition, access to Bitcoin is global, transaction costs are falling continuously and more and more institutional investors are getting on board.

The Brazilian company Méliuz, which is listed on the stock exchange, has announced that it has acquired Bitcoin worth 10 % of its liquid assets. According to local media, the investment was made on March 6, 2025, with Méliuz buying a total of 45.72 BTC for USD 4.1 million, which corresponds to an average purchase price of USD 90,296 per Bitcoin. This makes the company the first listed company in Brazil to hold Bitcoin as a strategic reserve.

Contra Bitcoin investment: volatility and uncertainty

At the same time, Bitcoin remains volatile: price fluctuations of 10 % in one day are not uncommon. This can pose a considerable risk for companies or investors who need stability and liquidity. Added to this is the regulatory uncertainty - countries around the world are debating stricter controls or even bans. Bitcoin may have long-term potential, but it remains a speculative asset in the short term.

Conclusion:

If you have large cash reserves, you should definitely consider cautious diversification. A small allocation - around 1-5 % - in Bitcoin can serve as a hedge against fiat currency risks. But anyone who invests more must be aware of this: Bitcoin is not (yet) a safe haven, but a highly speculative asset.

André Batterman