Shares of United States manufacturer Worksport (WKSP) surged 9.1% on Dec. 5 after the company decided to incorporate Bitcoin and XRP into its treasury strategy.
According to an announcement, Worksport plans to allocate up to 10% of any excess cash from operations to purchase Bitcoin (BTC) and XRP (XRP), with an initial investment of up to $5 million. Taking this step, the company expects to hedge against inflation while diversifying its treasury.
Nasdaq-listed WKSP on Dec. 5. Source: Google Finance
Along with investing excess reserves, Worksport will accept crypto payments on its e-commerce platform. The company anticipates a 37% reduction in transaction costs with crypto payments.
“As Bitcoin and XRP continue to gain investor attention and acceptance as major asset classes, we believe they may serve as strong treasury reserve assets. Their inflation-resistant characteristics make them increasingly reliable stores of value,” said Steven Rossi, CEO of Worksport.
Related: Bitcoin or bust: Companies add BTC to treasury for long-term potential
The company has been listed on the Nasdaq since 2021 and manufactures energy solutions for trucks, including tonneau covers integrated with mobile solar power generation systems. It plans to convert interest earnings from cash held in money market accounts into BTC and XRP, as well as allocate a percentage of future capital raises to cryptocurrencies.
“By strategically allocating a portion of our treasury to these digital assets and accepting crypto payments, we’re enhancing our financial strategy and aligning ourselves with the future of global finance,” Rossi added.
Workspot is following a growing trend among publicly traded companies of using cash reserves to buy digital assets.
MicroStrategy pioneered this idea when it began purchasing Bitcoin regularly in 2020. Initially seen as an unconventional approach, this strategy has netted the company unrealized profits of approximately $17 billion at current market prices.
Other companies that include BTC in their treasury holdings are Coinbase and mining firms such as CleanSpark, Riot Platforms, and Hut 8.
Beyond traditional crypto firms, companies such as medical manufacturing Semler Scientific, e-commerce platform Mercado Libre, and Chinese tech company Meitu also maintain digital assets on their balance sheets.
Related: Hut 8 to raise up to $500M to buy Bitcoin as a strategic reserve asset
