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Tuesday, November 29, 2022

Considering bitcoin on balance sheet

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People stand in front a banner displaying Palantir Technologies Inc. signage during the company’s initial public offering (IPO) in front of the New York Stock Exchange (NYSE) in New York, Sept. 30, 2020.

Michael Nagle | Bloomberg | Getty Images

Palantir, a software company that offers analytics tools to the defense industry and large corporations, is thinking about adding bitcoin to its balance sheet.

Chief Financial Officer David Glazer said in the company’s first-quarter earnings call that bitcoin was “definitely on the table” and that it would also consider holding other cryptocurrencies on its balance sheet.

When asked, “Could you ever see Palantir having bitcoin or any other type of cryptocurrency on its balance sheet?” Glazer answered, “The short answer is yes, we’re thinking about it, and we’ve even discussed internally. Take a look at our balance sheet, $2.3 billion in cash at quarter end, including $151 million in adjusted free cash flow in Q1. So, it’s definitely on the table from a treasury perspective, as well as other investments, as we look across our business and beyond.”

Glazer went on to say that Palantir already accepts bitcoin as a form of payment from customers.

Palantir was co-founded by Peter Thiel, a self-proclaimed “pro-crypto, pro-bitcoin maximalist,” who backed a bitcoin mining facility in Texas and recently warned that bitcoin threatens the U.S. dollar.

Though its co-founder is deeply entrenched in the world of bitcoin, Palantir joins a growing list of companies with no real grounding in crypto that are jumping aboard the bitcoin train.

In February, Tesla disclosed in an SEC filing that it had bought $1.5 billion worth of bitcoin for “more flexibility to further diversify and maximize returns on our cash.” It sold some of its holdings in the first quarter, which helped it reduce operating expenses by more than $100 million, and was sitting on $2.5 billion at the end of the quarter.

MicroStrategy, a Virginia-based enterprise software company, was an early mover in this trend toward companies buying bitcoin as an investment. The business intelligence firm said in April that it holds a total of 91,579 bitcoins, acquired at an average purchase price of approximately $24,311 per bitcoin, meaning the company spent about $2.23 billion. At today’s prices, MicroStrategy’s bitcoin stake is worth $5.14 billion.

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