Uber CEO Dara Khosrowshahi told CNBC on Thursday that the company had discussed, but “quickly rejected” the idea of buying bitcoin with corporate cash such as Telsa.
However, Khosrowshahi said Uber would consider accepting cryptocurrencies as payment.
The comments come after Tesla announced earlier this week that it had bought bitcoin worth $ 1.5 billion with some money in the balance sheet and intends to start accepting digital currency as payment for its products. Tesla’s moves have drawn attention to Wall Street, and some have questioned whether the electric vehicle manufacturer’s decision would be a tipping point for the later adoption of cryptocurrencies.
In an interview with Squawk Box, Khosrowshahi was asked if Uber was considering similar actions to Tesla. “It’s a conversation that happened, that was quickly rejected,” he said. “We will keep the money safe. We do not deal with speculation,” he said. “The advantage of our company is in the business we have built, not in the investments we invest in.”
As of December 31, Uber reported holding $ 5.65 billion in cash and cash equivalents, along with $ 1.18 billion in short-term investments.
Khosrowshahi, who took over as executive director of Uber in 2017, left open the possibility for the food transport and delivery provider to accept cryptocurrencies as payment.
“Just as we accept all kinds of local currency, we will analyze cryptocurrency and / or bitcoin in terms of the currency to be traded,” he said. “That’s good for business. It’s good for our riders and consumers. We’ll definitely look and if there’s an advantage there, if it’s needed there, we’ll do it. We just won’t do it as part of a promotion.”
On Wednesday, Mastercard announced intentions to open its network to some cryptocurrencies, a move that the credit card giant said would allow consumers and merchants to “trade in a completely new form of payment.” Mastercard has already allowed customers to make some cryptocurrency transactions, but they took place outside the company’s formal network.
The latest financial firm to put its weight behind crypto is BNY Mellon, which said on Thursday that it is launching a digital assets division later this year. Shares of America’s oldest bank rose on Thursday.
Proponents of companies that buy bitcoin for their corporate cash claim that, despite its daily volatility, digital currency has appreciated as a long-term value and will continue to do so. For this reason, supporters such as MicroStrategy CEO Michael Saylor consider it a more productive investment than keeping hordes of cash in the balance sheet.
Some skeptics are worried about the risks of bitcoin volatility, which in recent months has enjoyed a massive rush to trade more than $ 48,000 a coin at Thursday morning’s all-time highs. A year ago, bitcoin traded below $ 11,000. While Bitcoin has seen an increase in institutional adoption in recent times, some still believe that there are still too many uncertainties about its future.
Like Uber, PepsiCo chief financial officer Hugh Johnston told CNBC on Thursday that the beverage giant had “had a conversation” about buying bitcoin with its cash. “The conclusion I came to pretty quickly was that bitcoin is too speculative for the way we manage our cash portfolio,” Johnston told Squawk Box earlier shortly after the company reported revenue and revenue earlier. better than expected. PepsiCo reported fourth-quarter earnings of $ 1.47 per share on revenue of $ 22.46 billion. Shares fell on Thursday.
As for Uber, its shares fell on Thursday, following the mixed results of the company’s earnings in the fourth quarter. The stock advanced 6% during Wednesday’s session, heading for the bell-to-bell ratio. Uber said it lost 54 cents a share in the fourth quarter, slightly lower than analysts’ expectations for a 56-cent loss. $ 3.17 billion in revenue was below the $ 3.58 billion Wall Street was looking for. The company’s overall loss for the quarter was $ 968 million, an improvement from a loss of $ 1.1 billion in the same period last year.
The two largest offers of Uber companies – walks and food delivery – have known different destinies during the coronavirus pandemic. The “ride-hailing” segment suffered because people stayed home and traveled less. On the contrary, Uber Eats has seen its use increase as people have ordered delivery instead of dining at restaurants.