One of the benefits of cryptocurrencies, especially Bitcoin, is that it can be used to buy any product or service in a digital economy. For New York-based media company Gotham City Media Group (GCMG), this meant an opportunity for growth. GCMG began accepting Bitcoin as payment before expanding into other currencies and now has more than 300 clients worldwide.
The “microstrategy balance sheet” is a company that specializes in digital media. The company recently added Bitcoin to their balance sheet and are the latest in a line of companies to do so.
With the addition of $5 million in Bitcoin (BTC) to its balance sheet, Townsquare Media, a New York-based digital marketing and radio station firm, has become the latest enterprise to support the original cryptocurrency.
On May 10, Macroscope, a Twitter account that focuses on institutional trading, discovered a filing with the Securities and Exchange Commission (SEC) detailing Townsquare’s acquisition of Bitcoin.
Townsquare Media (NYSE: TSQ), situated in New York, revealed in an SEC filing today:
“The Company spent a total of $5.0 million in Bitcoin in the first quarter of 2022. The company thinks that digital assets have long-term investment potential.”
May 10, 2022 — MacroScope (@MacroScope17)
The corporation “invested an aggregate of $5 million into Bitcoin” during the first quarter of 2021, according to the filing, and offered an explanation for why it picked a crypto investment, stating:
“The Company thinks that digital assets have long-term investment potential. Based on our assessment of market circumstances, the Company may raise or reduce its holdings in digital assets at any moment.”
While the price of Bitcoin at the time of acquisition was not revealed, Townsquare reported a $400,000 impairment loss due to “changes in the fair value” of its digital asset holdings throughout the quarter.
The alleged loss seems to be the result of the peculiar reporting requirements for crypto ownership. Townsquare further alleged that it could have sold its Bitcoin for a total of $6.2 million on March 31, when the price of Bitcoin was about $45,500. Because it is so easy to convert Bitcoin to cash through a crypto exchange, the corporation considers its Bitcoin investment to be liquid.
MicroStrategy shareholders letter: We’ll ‘vigorously seek’ further Bitcoin acquisitions
While the acquisition pales in contrast to MicroStrategy’s almost $3 billion Bitcoin stockpile, Townsquare Media is in the middle of the pack when it comes to the amount of Bitcoin owned by publicly listed firms.
According to Bitcoin Treasures, a website that tracks Bitcoin holdings by firms, Townsquare would be midway between Bitcoin mining companies Cleanspark Inc. ($4.3 million) and Cathedra Bitcoin Inc. ($5.5 million).
Other corporations with large investments in the world’s first cryptocurrency have acknowledged losses owing to having the asset on their balance sheet as the price of Bitcoin has fallen this year and recently touched 10-month lows.
Galaxy Digital Holdings, a crypto investment manager, revealed a $111.7 million loss in the first quarter of 2022 owing to unrealized losses on its bitcoin portfolio earlier in May. Due to a Bitcoin-backed $205 million loan MicroStrategy took out in March, CEO and Bitcoin supporter Michael Saylor had to reassure investors that the business could fulfill its obligations if required.
The “what is one bitcoin worth” is a digital currency that was created in 2009 by Satoshi Nakamoto. The New York digital media company the latest to add Bitcoin to balance sheet.
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