Nexon Hodls Despite Chalking Up 40% of its USD 100M Bitcoin Buy as Loss
The crypto-keen South Korean gaming giant Nexon is continuing to hold its bitcoin (BTC) – even though it has written off some 40% of the money it spent on a groundbreaking USD 100m BTC purchase just months ago as a loss.
In an official release, Nexon said that, going forward, it would reassess its reporting of the asset’s worth in its next quarterly earnings report, slated for September this year.
This comes as Nexon’s Japanese operations said that it had decided to record just over USD 40m worth of asset valuation loss as an “external” non-operating expense.
Nexon sent pulses racing in Asia when it spent USD 100m worth of bitcoin at the end of April, buying BTC 1,717 for an average of around USD 58,000 per token.
Tumbling token prices have wiped millions off the asset’s worth, however. The firm spent just under 2% of its total cash and cash equivalents on the purchase, multiple South Korean and Japanese media outlets reported.
At the time of the purchase, Owen Mahoney, the President and CEO of Nexon, was quoted as stating that the firm was aware of and was studying the risks of crypto investment. But he also stated:
“Our purchase of bitcoin reflects a disciplined strategy for protecting shareholder value and for maintaining the purchasing power of our cash assets.”
The gaming firm, which is listed on the Tokyo Stock Exchange in Japan, seems to be a firm believer in crypto.
It bought South Korea’s first crypto exchange Korbit back in 2016, and snapped up Europe’s older trading platform Bitstamp a few years later.
The firm is also believed to have been interested in a deal to buy the Korbit rival Bithumb. The latter was put up for sale last year, but a potential Nexon deal that was reportedly on the verge of completion back in January was allegedly scuppered over possible contractual disagreements.
In the United States, all eyes will now be on the carmaker Tesla and its BTC holdings as the company is preparing to release its Q2 earnings report. However, the exact date when it might happen is uknown.
At 15:31 UTC, BTC is trading at USD 33,573 and is almost unchanged in a day. It dropped by 3% in a week and 9% in a month. The price almost halved after reaching its all-time high of around USD 65,000 in April.