On September 25, the board of directors of the U.S. listed company Jiuzi New Energy (NASDAQ: JZXN) approved a cryptocurrency asset investment policy, authorizing up to $1 billion for the purchase of Bitcoin (BTC), Ethereum (ETH), and Binance Coin (BNB). This makes Jiuzi New Energy one of the first Chinese background enterprises to incorporate cryptocurrency into its financial planning, highlighting the global institutional shift in attitude towards digital assets.
● Investment Scope and Limit
The board approved the allocation of up to $1 billion from internal cash reserves to invest in BTC, ETH, and BNB under controlled risk. If there are plans to expand to other assets in the future, it must be reviewed by the Risk Management Committee. This fund aims to strategically position itself in mainstream cryptocurrencies.
● Custody and Compliance Assurance
The company will not manage these assets directly but will entrust them to top-tier third-party custodians to ensure safety and compliance. Additionally, a "Cryptocurrency Asset Risk Committee" has been established to oversee investment execution and risk prevention.
● Cash Reserve Optimization
In the face of U.S. dollar inflation and geopolitical uncertainty, companies are viewing cryptocurrency as an alternative reserve tool. Jiuzi New Energy's move aims to preserve asset value and enhance volatility resistance, integrating it into its cash management framework.
● Motivations Behind the Decision
This decision is not just a financial adjustment but also a signal of Jiuzi New Energy's embrace of innovation. Key driving factors include: Addressing economic pressures and enhancing capital efficiency. The low interest rates in traditional markets and the depreciation of the dollar have made cryptocurrencies a hedging tool. Bitcoin is often compared to "digital gold," Ethereum supports the DeFi ecosystem, and BNB benefits from the resilience of the Binance platform. Through investment, Jiuzi New Energy can preserve capital, stabilize returns, and respond to international changes.
Aligning with the digital wave to enhance attractiveness, since 2020, U.S. companies like Tesla and MicroStrategy have been aggressively buying cryptocurrency assets. As an automotive dealer, Jiuzi New Energy's move strengthens its image of technological transformation, sending innovative signals beyond environmental concerns to attract young investors. Boosting shareholder value, the stock price surged by 37% after the announcement. Analysts believe this could attract attention from tech funds, enhancing brand and shareholder returns.
● Industry Trend: Accelerated Institutional Layout
Jiuzi New Energy's actions reflect the global trend of corporate cryptocurrency allocation. On September 24, Japan's Mac House increased its holdings by 23.9 BTC, bringing its total to 64.6 BTC; U.S. company Autris acquired BitCorp Capital to expand its Bitcoin reserves. Nasdaq's Iveda also received approval for a similar policy to promote asset diversification. On that day, the total disclosed cryptocurrency investment globally exceeded $1.03 billion, indicating that traditional companies are shifting from trial to systematic execution. Jiuzi New Energy is leveraging this momentum to consolidate its competitive advantage.
● Potential Challenges Despite Optimistic Prospects, Caution is Needed
Volatility risk management/The cryptocurrency market is experiencing severe fluctuations, and the company plans to invest in phases to buffer against this, but the real test has just begun. Regulatory and transparency pressures: The SEC is sensitive to cryptocurrencies, and Jiuzi New Energy must ensure compliance to avoid potential fines. Team capability building: Forming a team of cryptocurrency experts is crucial; otherwise, execution may deviate.
● Conclusion
The Institutional Turning Point of Cryptocurrency Allocation Jiuzi New Energy's $1 billion plan marks a deepening of corporate digital reform. It is not just a financial measure but also reflects the trend of traditional industries integrating into blockchain. As the cryptocurrency economy moves towards institutionalization, such entrants are piecing together a broader ecosystem. In the future, its implementation effects and international influence are worth tracking—this may be another milestone in the mainstreaming of digital assets.
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