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South Korean video game company buys $ 100 million in bitcoin

Nexon Co Ltd, a company based in South Korea that develops and distributes online video games announced on April 28, the purchase of USD 100 million in bitcoin.

The information was disclosed through a statement. The publication notes that the firm bought 1,717 bitcoins at an average price of around USD 58,226, including fees and expenses.

According to the press release, this purchase represents less than 2% of Nexon’s total cash and its available cash equivalents. In this regard, Owen Mahoney, President and CEO of Nexon noted the following:

Our purchase of bitcoin reflects a disciplined strategy to protect shareholder value and to maintain the purchasing power of our assets in cash. In the current economic environment, we believe that bitcoin offers long-term stability and liquidity by maintaining the value of our cash for future investments.

This movement of the company continues to other companies such as MicroStrategy and Tesla that are buying bitcoin as a mechanism to protect their capital from inflation.

With this purchase, Nexon is positioned in the ranking of the 10 companies that have bitcoin in their treasury.

It should be noted that NEXON is a company that It has been listed on the Tokyo Stock Exchange since 2011 and the Nikkei 300 stock index since 2017. The company was also added to the Nikkei 225 index in 2020.

Nexon enters the top 10 of the companies that have bitcoin in its treasury. Source: bitcointreasuries.org

The Nexon CEO added that, in general, the cash reserved in the bank can earn a few percentage points of interest with a very low risk, usually lending it to others. “But in today’s environment of historically low interest rates, these holdings do not generate almost any return, especially when compared to inflation.”

It follows that, with this last comment, Mahoney is refers to the printing of fiat money by governments as a great risk to the global economy.

Bitcoin as a safe haven asset against the issuance of fiat money

Until recently, monetary issuance without control by central banks was something only known among the inhabitants of Latin American countries, but not so for the residents of the United States, “where it is not yet understood what happens when you promote hyperinflation and your currency becomes garbage,” according to the journal sta Max Kesiser and television producer Stacy Herbert.

In several nations of the world, such as Venezuela, Argentina and Zimbabwe, uncontrolled money printing has generated hyperinflation. A similar effect could be expected in the United States given the historical injection of liquidity from the Federal Reserve to finance hundreds of companies and millions of Americans in times of paralysis and rising unemployment product of the COVID-19 pandemic, as reported by CriptoNoticias on December 9, 2020.

The potential of bitcoin as a haven of value was revealed in a study conducted by the firm Coin Metrics. The report indicates that since the end of 2020 the position of investors has been changing. There, he assures that the predictability and transparency of Bitcoin’s monetary policy give it a good potential of refuge in the face of inflationary environments.

Although there is no official list, as of today precious metals are considered safe-haven assets like gold and currencies like the dollar. In this case, bitcoin can also be considered as a safe haven asset against inflation that hits the purchasing power of the population with limited economic resources.

The most popular cryptocurrency has been designed for strict control of its issuance. Not only is the ceiling of bitcoins issued capped at 21 million, but every four years the pace of issuance is cut in half. Thus, inflation in Bitcoin decreases programmatically, as this media pointed out on April 27, 2021.

Bitcoin does not belong to any state or government and can be used worldwide, regardless of geographic and political barriers. Outside the fiduciary system: you cannot create debt with it, its value does not depend on an intervention of a central bank.

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Sandra Loyd
Sandra Loyd
Sandra is the Reporter working for World Weekly News. She loves to learn about the latest news from all around the world and share it with our readers.

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