The Need for Gold in Corporate Treasuries

The idea of companies investing part of their cash in bitcoins is becoming more and more widespread, even if few actually take the plunge. Surprisingly, however, gold, which is far more widely recognized and accepted, does not enjoy comparable publicity. Why is this?

Clearly, business leaders are extremely reluctant to invest part of their cash in physical gold or bitcoin, rather than in the financial products offered by their banks. It's the weight of habit, the inertia of behavior. It's about time we woke up, however, at a time when these two assets are performing well - with the price of gold outperforming that of bitcoin since the beginning of the year.

There's no point in hoarding hard-earned money if it's going to be eaten up by inflation! But protection against rising prices isn't the only advantage of gold and BTC. They also offer genuine diversification, thanks to their low correlation with traditional assets. They also offer protection against the loss of currency value, the ability to exit the banking system - and thus eliminate the risk of bankruptcy or seizure of accounts - while being highly liquid (in the event of a hard blow, they are immediately available). The advantages are numerous.

With inflation likely to pick up again (money printing, energy prices) and geopolitical tensions on the rise, it's becoming more necessary than ever to invest part of your cash outside the banks, in solid assets that genuinely protect their holders and even contribute to enriching the company over the long term.

Highly volatile, bitcoin needs to be purchased for at least four years, while gold, which is more stable, can be acquired with a shorter time horizon, which in itself is an advantage in the face of economic uncertainties. Of course, the two assets are perfectly complementary.

Bitcoin enjoys worldwide publicity thanks to Michael Saylor, the founding CEO of Strategy (formerly MicroStrategy), who holds... half a million BTC. He's trying to convince America's big bosses to follow him, without much success so far, but at least it's getting the subject talked about in the press. There's no equivalent personality to promote the purchase of gold by companies (for individuals, there are many). That's a shame.

There are up-to-date lists of companies owning bitcoin (such as BitcoinTreasuries.com, for example) but as far as we know, no similar resource exists for gold.

Undoubtedly, more needs to be done in terms of information and promotion.

From a tax and accounting point of view, there's nothing too complicated: all you have to do is calculate the capital gains or losses each year for the company's accounts, just like an asset whose value varies. You'll probably have to push your accountant a little, but it's within their grasp.

In short, companies - from small retailers to multinationals - need to be aware of the usefulness, if not the necessity, of investing part of their cash in physical gold. They can only be pleased... and gain an advantage over their competitors. Go!