Hold Two Payrolls Cash in Bitcoin as Hedge: VC Tells Businesses
- “Governments are taking over banks, and governments are at risk of becoming insolvent,” the VC wrote.
- Bitcoin has hit a nine-month high as the US banking sector battles a liquidity crunch.
Tim Draper, a billionaire venture capitalist, has advised companies to diversify their cash management plans and keep some of their money in Bitcoin (BTC) and other cryptocurrencies. According to a snapshot shared on Twitter, Draper asked businesses to hold at least two payrolls worth of cash in Bitcoin.
The announcement comes amidst the rising economic unpredictability in the US following the collapse of three prominent banks. “Business can no longer rely on one bank or governing body to manage their cash,” Draper wrote.
Furthermore, the venture capitalist underlines the necessity for these backup strategies, noting that they can assist companies in surviving financial crises. In his words:
For the first time in many years, governments are taking over banks, and governments are at risk of becoming insolvent. Bitcoin is a hedge against a domino run on the banks and poor over-controlling governance.
Following the news of the Federal Reserve printing $300 billion to bail out the struggling banks, Changpeng Zhao, the CEO of Binance, took to Twitter to ridicule the US financial system. The CEO first lauded the Bitcoin technology’s core feature that makes it resist inflationary pressures:
“No one can print Bitcoin out of thin air,” he tweeted, adding in another thread that “Bitcoin is volatile, but it never needed a bailout.”
While Bitcoin hits one of its highest points in nine months as the US banking sector battles a liquidity crunch, the CEO teased: “I didn’t see the ‘Bitcoin is not a store of value’ narrative in the past week.”