Uber would not purchase Bitcoin with money, it could later settle for it as a type of cost
Dara Khosrowshahi, CEO of Uber, told CNBC Thursday that the company had discussed the idea of buying Bitcoin with corporate money like Telsa, but “quickly rejected” it.
However, Khosrowshahi said Uber would consider accepting cryptocurrencies as payment.
The comments came days after Tesla announced it would buy $ 1.5 billion worth of Bitcoin with some cash on its balance sheet and plans to accept the digital coin as payment for its products. Tesla’s moves caught Wall Street’s attention, and some wondered if the electric vehicle maker’s decision would mark a turning point in further adoption of crypto.
In an interview on Squawk Box, Khosrowshahi was asked if Uber had considered similar measures. “It’s a conversation that happened and was quickly dismissed,” he said. “We will keep our money safe. We are not in the speculative business,” he added. “The advantage of our company is in the business we have built, not the investments we invest in.”
As of December 31, Uber said it had cash and cash equivalents of $ 5.65 billion and short-term investments of $ 1.18 billion.
Khosrowshahi, who took over the management of Uber in 2017, left open the possibility that the hailship and grocery delivery company would accept cryptocurrencies as payment.
“Just as we accept all types of local currencies, we will deal with cryptocurrency and / or bitcoin in terms of the currency to be traded,” he said. “It’s good for business. It’s good for our drivers and our eaters. We’ll definitely see that and if there is an advantage there, if there is a need, we will. We just won’t to do.” as part of a doctorate. “
On Wednesday, Mastercard announced its intention to open its network to some cryptocurrencies. According to the credit card giant, consumers and merchants can “do business in a completely new way of payment”. Mastercard had already had customers conduct some cryptocurrency transactions, but these took place outside of the company’s formal network.
The latest financial firm to advocate for crypto is BNY Mellon, which opens a digital assets division on Thursday later this year. The oldest bank in America rose on Thursday.
Proponents of companies buying Bitcoin for their corporate money argue that, despite its daily volatility, the digital coin has and will continue to appreciate in value over the long term. Because of this, supporters like Michael Saylor, CEO of MicroStrategy, think it’s a more productive investment than keeping hordes of cash on the balance sheet.
Some skeptics are concerned about the volatility risks of Bitcoin, which has seen a massive surge in recent months to trade at all-time highs above $ 48,000 per coin on Thursday morning. A year ago, Bitcoin was trading below $ 11,000. While Bitcoin has seen increasing institutional acceptance lately, some still believe that there is still too much uncertainty about its future.
Like Uber, PepsiCo CFO Hugh Johnston told CNBC on Thursday that the beverage giant was “having the conversation” about buying Bitcoin with cash. “The conclusion, which we came to pretty quickly, was that Bitcoin was too speculative for the way we manage our cash portfolio,” Johnston said earlier in “Squawk Box,” shortly after the company made better than expected profits and Had reported sales. PepsiCo posted fourth quarter earnings of $ 1.47 per share on sales of $ 22.46 billion. Shares fell on Thursday.
Uber was flat on Thursday after the company posted mixed results in the fourth quarter. The stock gained 6% during Wednesday’s meeting. Uber announced it lost 54 cents a share in the fourth quarter, which is slightly less than analysts’ expectations for a 56 cents loss. Sales of $ 3.17 billion were below Wall Street’s desired sales of $ 3.58 billion. The company’s total loss for the quarter was $ 968 million, an improvement over a loss of $ 1.1 billion for the same period last year.
Uber’s two largest business offerings – hailstorm and grocery delivery – have seen different fates during the coronavirus pandemic. The hailstorm segment suffered when people stayed home and traveled less. Conversely, Uber Eats saw its usage spike as people ordered delivery instead of dining at restaurants.