Cryptocurrencies have not always been associated with the corporate world. In fact, not too long ago, most people would have considered the idea downright ludicrous. However, things have steadily changed over the years, and the marketplace is now much different from what it used to be. Much of it has to do with the fact that people now have a better understanding of what cryptocurrencies entail. While there’s still the association with volatility and continuous price fluctuations, people also know that having a strong strategy and following the latest market trends can help tremendously.
If you’ve been doing your research on how to buy crypto in order to maximize your chances of success, then you know that keeping up with macroeconomic factors and the marketplace metrics is the surest way to guarantee that your portfolio is successful and that you make the best choices for your list of holdings. The fact that institutional investors have become increasingly interested in digital assets has further incentivized the market, leading to increased engagement and price consolidation.
However, some have begun to think that many of these companies are not actually interested in the crypto community at all, and that they’re simply using the market’s popularity to boost their own reputations.
Corporate Bitcoin
The number of corporate BTC treasuries has doubled during the first half of the year, indicating that growth remains strong after the market began to gain momentum in the fourth quarter of 2024. While this is undoubtedly good news in theory, as institutional investors bring significant amounts of capital to the environment, making prices more consolidated and reliable, others believe that not all businesses’ intentions are pure.
Some researchers have drawn parallels between this trend and that of corporate gold adoption (a fitting comparison given the fact that Bitcoin is often referred to as “digital gold”), as both provide investors with access to a powerful asset that they had previously struggled to acquire. The companies believed to be using cryptocurrencies as a sort of lifeline are those dealing with hardships in some form, and the resulting pressure makes it more likely for them to resort to using cryptocurrencies.
The rise of altcoins
It isn’t just Bitcoin that has become popular among institutional investors. Altcoins are similarly added to their treasuries as a means of securing them and providing value. This category refers to all digital tokens that aren’t Bitcoin, since BTC was the first to be launched on the market, and all those that followed used it as a blueprint when building their own systems. Ethereum, the second-largest coin in terms of market capitalization, is naturally a favorite, especially since its platform is known for its innovative tech.
The Ethereum blockchain hosts non-fungible tokens, was fundamental to the rise of decentralized finance, and supports a large number of decentralized applications. All these functionalities are set to become increasingly important over the next few years, with some analysts believing that they ought to be integrated into traditional financial markets in order to improve their functionality, efficiency, and transparency. Since it is both a coin and a tech equity, Ethereum sounds particularly promising for these ambitious investors, many of whom are looking for ways to look beyond the confines of passive storage.
The simple fact that both Bitcoin and altcoins are considered to help boost the reputation of several enterprises is, in itself, incredibly noteworthy, as only a few years ago, integrating crypto into business procedures would have been a very bad move.
The launch of the digital euro
The EU has begun adopting a more comprehensive set of regulations that could help the crypto market become safer and more trustworthy for users based in the union. Part of that functionality involves the creation of a digital euro, an asset that has been recently analyzed by both Ethereum and Solana, providing a foundation for the new ecosystem. The European Central Bank is considering running the digital euro on a public blockchain network instead of a centralized one. The main difference is that, in a public blockchain, the data is open to everyone, whereas in the private option, the information must be approved by an authorized entity first.
The tech framework needed for the project has not yet been completed, but it is definitely in development as the officials have begun taking the crypto market much more seriously over the last few years. The reason Europe has been seeking to secure its position in the crypto environment is also due to the push for stablecoins in the United States. The implications for the continuous autonomy of the EU’s financial system are very complex. Board members of the ECB have suggested that introducing a digital euro could decrease the use of stablecoins on the continent. Right now, about 98% of the stablecoins in circulation are backed by the US dollar.
As is always the case with cryptocurrencies, lawmakers are examining both the positive and negative aspects to determine the best course of action. A digital euro coin based on a public network would be better equipped to navigate and operate on the blockchain infrastructures that have dominated the cryptocurrency marketplace over the last few years. However, some point out that the project is not yet guaranteed, so it may not happen at all. A definitive decision is expected by the end of December.
Brazil’s new crypto task
Some investors consider the adoption of a crypto tax in Brazil to signify the end of tax-friendly cryptocurrency investments worldwide. So far, small crypto gains had been exempt from taxes, but that came to a screeching halt as lawmakers introduced a 17,5% tax on all capital gains resulting from trading on the crypto marketplace. However, this isn’t just a local change. Researchers have observed that this is part of a broader global trend.
Two years ago, Portugal introduced a 28% tax on digital currency gains that had been held for less than a year. The country had also allowed cryptocurrencies to be entirely tax-free up to that point. In Germany, only holdings that are held for over twelve months are tax-free. However, the same policy applies to holdings that are less than one year if they are valued at up to 600 euros.
If you’re an investor, conducting thorough research is essential. It can save you from a lot of trouble and guarantee your gains remain consistent. As the marketplace continues to change, this has become more important than ever.
