Altvest Capital Ltd. (JSE: ALV) has announced its adoption of Bitcoin (BTC) as a primary treasury reserve asset, making it the first publicly listed company in Africa to implement such a strategy.
The action is in line with the methodology used by Michael Saylor’s MicroStrategy, whose market value increased by more than 2,400% after it started amassing Bitcoin in 2020.
Altvest has purchased one Bitcoin and is currently seeking regulatory approval to raise 200 million rand ($10 million) through a share sale to increase its Bitcoin holdings. However, no final decision has been made regarding the fundraising
Why Bitcoin?
Altvest bases its choice to invest in Bitcoin on a number of considerations, such as:
- Scarcity & Inflation Hedge: With a fixed supply of 21 million coins, Bitcoin is resistant to inflation and currency devaluation.
- Decentralization & Security: Bitcoin operates on a decentralized network, free from control by any central authority.
- Institutional Adoption: Major corporations, financial institutions, and sovereign funds have increasingly integrated Bitcoin into their treasury holdings.
- Liquidity & Market Depth: Bitcoin is the most liquid digital asset, with daily trading volumes exceeding $20 billion.
- Regulatory Clarity: Bitcoin has gained increasing regulatory recognition in South Africa and globally.
Risk Assessment and Strategic Allocation
Altvest’s board of directors conducted a comprehensive risk analysis before making its Bitcoin investment. CEO Warren Wheatley emphasized that the company views Bitcoin as a long-term strategic reserve asset that provides a hedge against economic instability and currency depreciation, particularly the depreciation of the South African Rand.
The company does not currently plan to invest in other cryptocurrencies, citing concerns over centralized governance, inflationary supply mechanisms, and regulatory uncertainties.
The strategy of using corporate cash—or even raising capital—to buy Bitcoin has gained traction globally. MicroStrategy, which pioneered this approach in 2020, has seen its market capitalization rise to approximately $82 billion, while CEO Michael Saylor’s personal fortune has climbed to $7 billion.
Altvest’s move marks a milestone for African-listed companies, signaling growing institutional adoption of Bitcoin as a legitimate store of value.
Future Plans: Investing in South African Rugby
Beyond Bitcoin, Altvest Capital is planning to acquire a stake in South Africa’s national rugby team, the Springboks, the reigning world champions. Wheatley stated that customers will be able to invest in the team through Altvest’s platform.
Altvest has committed to ongoing monitoring of its Bitcoin holdings, ensuring compliance with financial regulations while maintaining transparency with shareholders. The firm’s decision could pave the way for other African companies to explore Bitcoin as a treasury asset.
