Brazilian fintech company Méliuz (CASH3) has announced the launch of a new strategy aimed at increasing Bitcoin reserves. It includes the use of derivatives to account for cryptocurrency volatility.
Méliuz's New Strategy
Méliuz has launched a new strategy to increase its Bitcoin reserves involving the sale of put options, allowing the company to benefit from Bitcoin's volatility. In a regulatory filing published on September 9, the company confirmed it is now actively selling Bitcoin options.
Details of Strategy Execution
The strategy involves selling options with pre-defined strike prices. If Bitcoin's price remains above the strike price, the company receives the premium and rolls it into new BTC purchases. If the price falls below the strike and the contract is exercised, Méliuz will buy Bitcoin at the agreed-upon price. 'In the event of exercise, the company will use its pre-allocated cash reserves to acquire Bitcoin at potentially more attractive prices,' the company states.
Market Influence and Company Future
Méliuz emphasizes that its strategy is fully backed by cash, minimizing financial mismatch risks. Less than 10% of its minimum operational cash is committed as collateral. Specialized strategic partners assist in the implementation of the strategy, and results will be reported in quarterly financial statements. This move could change how corporate firms approach cryptocurrencies and encourage broader adoption in Latin America.
The Méliuz initiative to leverage derivatives to increase its Bitcoin reserves could significantly impact the market and prompt a re-evaluation of cryptocurrency strategies among companies in the region.
