Bitcoin for Business

The Profit Predicament: What to Do with Your Hard-Earned Cash As a business owner, there's no feeling quite like watching your profits roll in. You've worked hard to create a product or service that people love, and it's paying off. But once you've got that profit in hand, the question is: what do you do with it? You've really only got two options, and each comes with its own set of pros and cons:  1. You could return the profits to your shareholders, which is a great way to reward them for their investment. However, if you give them all the profits, you'll be left with no safety net in case things go wrong. And let's face it, things can go wrong quickly - supply chain disruptions, interest rate changes, unplanned maintenance, and other unexpected events can throw a wrench in your plans. 2. Another option is to keep the profits. But if you store the profits in your bank account, which seems like a safe and prudent move, that money will slowly lose its value over time. It's like trying to hold onto a melting ice cube - it's just not going to work. Inflation is a real thing. So, what's a business to do? Once you've built up a basic emergency fund (think 6 months' worth of working capital), you need to decide how to manage the rest of your profits. If you've got new products or services you want to launch, you could reinvest in your own business through capital expenditure or R&D. You could also look to grow horizontally to vertically through acquiring a supplier, client or competitor, but mergers and acquisitions can be notoriously tricky and don’t always deliver the expected result. The problem is, investing always comes with risk - the higher the potential reward, the higher the risk. You could try investing in real estate (traditionally seen as low risk), but that's not always the most liquid option – selling real estate can take months or years (and let's be real, who wants to deal with property taxes and maintenance?). That's where Bitcoin comes in.  Bitcoin is inflation beating: From 2011 to 2023 its average annual return of 54% not only beats inflation but also pretty much most other high-risk investments.  Bitcoin is liquid: An always-open, 24/7/365 market with final settlement in under an hour, anywhere in the world, makes this an unbeatable vehicle. No bank holidays or weekend banking interruptions to worry about. So, if it bothers you that you have to put your profits at risk just to protect them from inflation, then Bitcoin is something you really need to look at.

What’s the largest South African company that has bought Bitcoin? We can’t afford to get left behind. https://lnkd.in/dzQti9Y6

The great Ray Dalio is suggesting Bitcoin as an investment against a looming debt money problem. Businesses should be doing this to weather proof themselves against the coming storm. https://lnkd.in/exiYAhQM

A Simple Trick to Eliminate Risk in Home Loans: Banks Need to Start Doing This Now Imagine this: a borrower wants a R1 million mortgage to buy a house. They go to the bank for a loan. The bank agrees, requiring just a 20% down payment upfront, with the borrower putting down R200k of their own money, and the bank funding the remaining R800k. Risks abound for the lender in this scenario. If the borrower defaults and stops paying, the bank must evict them, foreclose on the home, and sell it at a loss. Distressed auctions usually get 30-40% below market value leaving the bank with loss. Let's lay it out: Purchase price: R1,000,000 Borrower equity: R200,000 Loan to Value ratio: 80% Bank loan: R800,000 But if a distress sale occurs 4 years into the deal and the bank must sell at a 40% discount, they're left with R757,811. So the bank's position is: The home increases at 6% per year, and after 4 years = R1,263,019 Distressed auction value (40% below market value) = R757,811 Bank exposure is auction value less initial loan amount (R800k – R757,811) = R42,188 loss But what if, instead of a regular loan, the bank bought R33,300 of Bitcoin with part of the borrower's R200k down payment? This is a stunning insight. Bitcoin investment: 3.33% of home value (R33,300) Historic worst-case return on Bitcoin over four years: +27% Bitcoin value after four years: R42,291 This works out brilliantly in the bank's favour. Even if the borrower defaults and the home must be sold at a loss, the bank comes out way ahead. It’s actually better than this, for the bank, as the homeowner has paid his premiums for 4 years and the bank’s loan amount is slightly lower. The 27% return on the Bitcoin is the worst it has performed over a 4-year period. The second worst return is 57%, and now the bank is making money. This buys time for both parties to negotiate a new arrange to avoid the costs involved in evictions and auctions. This is a massive innovation. Banks should be doing this right now. It's cheap insurance against defaults. It protects the homeowner too. Win – Win

South African businesses, both large and small need to pay attention to this. On 10th December 2024 Microsoft shareholders will be voting on adopting a bitcoin reserve strategy. The link below is a very short, but jam packed presentation by the Chairman of the largest publicly traded bitcoin holder in the US, MicroStrategy. In 3 minutes you will have hours worth of material to discuss with your fiends and mentors. #bitcoinforbusiness #businessstrategy https://lnkd.in/ebRrkFQZ

This piece is a must read for business owners in South Africa. There is an old saying, "Give me control of a nation's money supply and I care not who makes its laws.". Abuse of the money supply will ruin an economy. However while Bitcoin can protect against such abuse, it can also be a tool to boost our economy. Not only should we minimise draconian regulations that restrict or limit the use of Bitcoin, but we should actively encourage the development of a Bitcoin economy such as, developers, products & services, circular economy. Make South Africa the top destination for Bitcoin innovation. Attract the brightest minds here. We have the chance to be global leader, but the window is closing rapidly other countries are waking up. #bitoin #business #freemarketfoundation #moneterypolicy #economicdevelopment https://lnkd.in/dqNuXDbh

If you are a retail business looking to see how bitcoin could work for you, then you need to take a look at ybitcoin.co.za. These guys keep things simple to understand and easy to implement. #ybitcoin #bitcoin #payments

South African businesses that would like to learn more about merge bitcoin as a reserve asset and corporate compliance can contact James Caw from SimplB. https://www.simplb.co.za/

Financial wisdom has always been that there is a limit to how much you can save, but not how much you can earn. Entrepreneurs know this. For the first time in human history it is now possible to save yourself into a much stronger financial position. Bitcoin's fixed supply, combined with it's pristine monetary properties means it will increase in value, against all other currencies, forever. Talk to us to start your journey of discovery.

South African businesses owners should listen to this. Great discussion about how business adoption of #bitcoin has increased by 30% over the last year! https://t.co/jBzxfFdKGx