According to the latest documents submitted to the US Securities and Exchange Commission, Globant, one of the four largest technology companies in Argentina, has quietly entered the field of cryptocurrency investment. The company bought Bitcoin in the first three months of this year and has now become part of some LATAM unicorns that have adopted the method of investing part of their value in crypto assets.
Global investment in cryptocurrency
According to the latest documents filed with the US Securities and Exchange Commission, Argentina-based software technology giant Unicorn Globant has joined some groups of companies currently investing in cryptocurrencies. The company was founded in 2003 and reported that it purchased $500,000 in Bitcoin (BTC) in the first quarter (Q1) of 2021. For a company valued at more than $6.5 billion and listed on the New York Stock Exchange (NYSE), this is a small amount.
Globant lists Bitcoin companies as part of intangible assets, stating that Bitcoin is:
Because Bitcoin lacks a physical form and has no limit on its useful life, it is considered an intangible asset for an indefinite period of cryptocurrency. Bitcoin does not need to be amortized, but needs to be tested for impairment.
The document shows that Globant purchased bitcoins of the aforementioned value, but did not specify the number of bitcoins purchased or the price the company paid for these bitcoins. However, the document does state that if the asset price is lower than the purchase price, Globant will recognize an impairment loss and will not record gains until the asset is sold.
Although some US-based companies (such as Microstrategy and Tesla) and asset management companies (such as Grayscale) have quickly entered the cryptocurrency trend, their LATAM-based counterparts have taken a more moderate approach to this new asset class. This may be related to how fast these companies adopt innovation and how their own business models manage risk and opportunity balance.
Argentine companies have begun to adopt cryptocurrency
However, Globant is not the first Argentine company to venture into cryptocurrency. Mercadolibre, an electronics retailer with a larger business in LATAM, bought $7.8 million in bitcoins this month and announced that it was part of its funding strategy, which may imply that more bitcoins will be purchased in the future. Mercadolibre also launched a real estate platform that only accepts Bitcoin payments.
Due to the depreciation of the national currency and the difficulties they face in obtaining U.S. dollars, it is expected that more LATAM-based companies, especially Argentine companies, will soon adopt encryption as part of their business strategy.
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