Apple and Bitcoin rumours

[coolajami]

I'm not sure if this kind of posts are allowed in this forum (Admins , if they don't, please accept my apologies and delete the post!).

Anyway there are growing rumours in twitterland that Apple has purchased bitcoins worth $2.5 billion. The news didn't gain so far much traction within mainstream media apart from second-class online news outlets.

I just wondering if anyone has any thought on this.

Personally, I don't think they hold any truth these rumours, as I cannot see what is the benefit for Apple.
I assume that the name of Apple was involved for price manipulation from sketchy crypto-traders who they attempt through rumours to tie popular companies to the bitcoin-wagon with the hope that would drive the price higher.

 

[KaliYoni]

The short answer: probably not.

The long answer: AAPL is a mega-market capitalization stock that is minutely followed by professional investors, investment banks, individual investors, the general media, the tech media, and the financial media. The stock is owned by many gigantic asset management companies who employ people whose job it is to know everything about Apple, its current and projected financial position, and its current and projected financial performance. If Apple converted some of its ultra-safe, rock solid cash holdings to bitcoin–or any other cryptocurrency–whose value can plummet or soar depending on how Elon Musk is feeling on a given day, the news would not be limited to Twitter. Such a move would also be immediately reflected in AAPL's price. So if you really think AAPL might commit billions of dollars to crypto, my recommendation is for you to start tracking Apple's stock price and news every day at a place like Google Finance or Yahoo Finance.

 

[coolajami]

The short answer: probably not.

The long answer: AAPL is a mega-market capitalization stock that is minutely followed by professional investors, investment banks, individual investors, the general media, the tech media, and the financial media. The stock is owned by many gigantic asset management companies who employ people whose job it is to know everything about Apple, its current and projected financial position, and its current and projected financial performance. If Apple converted some of its ultra-safe, rock solid cash holdings to bitcoin–or any other cryptocurrency–whose value can plummet or soar depending on how Elon Musk is feeling on a given day, the news would not be limited to Twitter. Such a move would also be immediately reflected in AAPL's price. So if you really think AAPL might commit billions of dollars to crypto, my recommendation is for you to start tracking Apple's stock price and news every day at a place like Google Finance or Yahoo Finance.

I'm not interested buying Apple stocks or Bitcoin and I was not looking for investment advice (apologies, if it sounded like I did).

I merely interested in the mechanics involving a behemoth of a company like Apple with a volatile asset like Bitcoin, and I was interested to see if anyone thought that this could actually be a sensible move from Apple in terms of finance/reputation etc (I personally don't).

My personal opinion is that some of the bitcoin "whales" want to cash out, and they hope to throttle the price just enough to be able to do so in the best possible terms.

 

[KaliYoni]

the mechanics involving a behemoth of a company like Apple with a volatile asset like Bitcoin, and I was interested to see if anyone thought that this could actually be a sensible move from Apple in terms of finance/reputation

Apple, like any company, can do whatever it wants with its money. But Apple actively cultivates a reputation for holding massive amounts of cash in extremely safe and stable assets, such as Treasury bonds, and for providing conservative guidance to Wall Street analysts. This reputation is a major driver of Apple's stock price. So if Apple decided to switch from using risk-free, guaranteed return assets for its cash holdings, the move would be a significant and material change to both its financial strategy and financial position. Apple has a duty, as a company traded on a major stock exchange, to disclose such a major change publicly. This sort of news would not be distributed via whispers on Twitter.

From a strategic perspective, it doesn't make a lot of sense for Apple to begin trading Bitcoin. It is not a financial services company or investment bank. It generates massive amounts of revenue from its current activities in technology. It can hedge currency risk using standard methods without any problems. Further, Apple spends a lot of resources on completely locking its customers into Apple hardware, software, and services. If anything, I would expect Apple to launch a proprietary -Coin that is tied to Apple Wallet and ApplePay. But, of course, anything is possible so maybe we will see Tim Cook aping the Winkelvoss brothers someday. That seems pretty out of character for Apple though.

 

[coolajami]

Apple, like any company, can do whatever it wants with its money. But Apple actively cultivates a reputation for holding massive amounts of cash in extremely safe and stable assets, such as Treasury bonds, and for providing conservative guidance to Wall Street analysts. This reputation is a major driver of Apple's stock price. So if Apple decided to switch from using risk-free, guaranteed return assets for its cash holdings, the move would be a significant and material change to both its financial strategy and financial position. Apple has a duty, as a publicly held company traded on a major stock exchange, to disclose such a major change publicly. This sort of news would not be distributed via whispers on Twitter.

From a strategic perspective, it doesn't make a lot of sense for Apple to begin trading Bitcoin. It is not a financial services company. It generates massive amounts of revenue from its current activities . It can hedge currency risk using standard methods without any problems. Further, Apple spends a lot of resources on completely locking its customers into Apple hardware, software, and services. If anything, I would expect Apple to launch a proprietary -Coin that is tied to Apple Wallet and ApplePay. But, of course, anything is possible so maybe we will see Tim Cook aping the Winkelvoss brothers someday. That seems pretty out of character for Apple though.

My thoughts exactly, throttling share prices is something expected by E.Musk but it is out of character for Apple. Also, all this "green initiative" goes out of the window, if Apple gets in the crypto game.