An overwhelming majority (84 per cent) of finance executives say holding Bitcoin poses a financial risk due to its volatility. A smaller number (five per cent) expect to hold some Bitcoin this year and that number rises to nine per cent when looking ahead to 2024.
All up, 16 per cent of finance executives still say they are willing to hold Bitcoin in the future as part of their organisation’s financial strategy.
These findings are part of new research from Gartner called What CFOs are Saying about Bitcoin (Login required).
Indeed, there are many risks that come from holding or trading cryptocurrency (and Bitcoin) as noted below.
There are many technology and business challenges in working with crypto/digital currencies, but we believe these risks will be mitigated with the evolution and maturity of CeDeFi as defined in our research note What you need to know about Blockchain DeFi (Login required)
Below we outline the types of digital currencies that live on blockchain, and what organisations can do with them. We highlight income that bitcoin holders can earn through CeFi vs DeFi. The differences are enormous, and so are the risks.
Indeed many companies are already engaged in leveraging their Bitcoin holdings. Here is a comparison of CeFi lending rates and DeFi yield farming rates.
The risks in using DeFi are extraordinarily high — and without regulation and legal protections, organisations will surely stay away no matter the benefits and rewards. CeDeFi is the area ripe for innovation — user interfaces, seamless access, smart contract security, and regulatory, legal protections. Stay tuned.
This article is republished with permission of Gartner.