Bitcoin is growing in price and popularity, but it seems that companies are not yet confident enough to invest in it.
This is according to a survey conducted by Gartner, a leading market research company.
According to their latest analysis conducted in February 2021, only 5% of finance executives admitted to planning an investment in Bitcoin for their company in 2021. The survey involved 77 finance executives including 50 CFOs (Chief Financial Officers). Of these, 84% do not plan to include it as a corporate asset in 2021.
Most are frightened by Bitcoin’s high volatility (84%). In contrast, 39% say their risk management team is against it. This is followed by the fear that it will not be accepted as a payment method, doubts about regulation, and the awareness of not having the necessary expertise. Finally, 25% fear the risks of cyberattacks, and 18% find it complicated to manage.
The survey also notes that 71% of respondents would like to know what to do with Bitcoin, while 68% would like to know first what regulators will decide.
Only 16% would be willing to adopt Bitcoin as part of their financial strategy, and yet, the survey notes, they are in no rush. Such that:
- only 5% will do so in 2021,
- 1% will postpone investment until 2022-2023.
- 9% will wait until 2024
Companies and investments in Bitcoin, the fears
Alexander Bant, head of research in the Gartner Finance practice, commented on the survey as follows:
“Eighty-four percent of the respondents said that bitcoin’s volatility posed a financial risk,” said Alexander Bant, chief of research in the Gartner Finance practice. “It would be extremely difficult to mitigate the kind of price swings seen in the cryptocurrency in the last five years”.
According to Bant, at this rate the much desired mass adoption will not happen:
“There are a lot of unresolved issues when it comes to the use of bitcoin as a corporate asset,” said Mr. Bant. “It’s unlikely that adoption will increase rapidly until we get more clarity on these challenges”.
Big finance is probably not ready, according to the Gartner representative:
“It’s important to remember this is a nascent phenomenon in the long timeline of corporate assets,” said Mr. Bant. “Finance leaders who are tasked with ensuring financial stability are not prone to making speculative leaps into unknown territory”.
Apparently Microsoft, which has stated that it will not invest in Bitcoin at the moment, is not alone. It seems that there are definitely more companies that are not ready, compared to those inclined to take the leap, like Tesla.