The Canadian branch of one of the world’s largest and most respected accounting firms just added Bitcoin and Ethereum to its corporate balance sheet. KPMG Canada reported on 7th February 2022 that it had completed an allocation of crypto assets to its corporate treasury, making a direct investment in bitcoin and Ethereum.
During the announcement, KPMG’s Benjie Thomas, the Canadian Managing Partner, Advisory Services said that “crypto-assets are a maturing asset class”. He added:
“This investment reflects our belief that institutional adoption of crypto-assets and blockchain technology will continue to grow and become a regular part of the asset mix.”
Apart from Tesla, Square, and MicroStrategy, KPMG becomes one of the few publicly traded companies to get into the crypto space. Being one of the most respected global firms providing accounting, financial advisory, and taxation services, this move is a huge vote of confidence in the future of blockchain and crypto in particular.
Kareem Sadek, an advisory partner of blockchain and crypto for KPMG Canada, said,
“We believe in this sector, we believe in this industry, and we believe that there’s many (sic) good stuff to come.”
KPMG’s Getting “Skin in the Game”
Speaking to Coindesk TV, Kareem Said that the firm didn’t just do it on a whim. As a financial advisory firm with clients all over the globe, KPMG is expected to be prudent and to do the necessary due diligence.
Kareem said that it took months of consultation and assessment and that it was mainly driven by the firm’s belief in the utility of the underlying technology of blockchain and crypto. They also consulted experts and professionals in the industry, eventually working with Gemini Trust’s execution and custody services to acquire bitcoin and ether.
In Kareem’s own words, it was important that KPMG needed to get “skin in the game,” to understand the industry more deeply so that they can better advise clients.
KPMG has many corporate clients who already hold crypto assets-in fact, MicroStrategy is a client of KPMG US. The firm wants to be able to tell its clients, “we have done it ourselves, we have been there, we understand.”
Firm Attracted by Growing Interest
Like other big companies investing in various sectors of blockchain and cryptocurrency, KPMG has been attracted by the growing utility of blockchain technology as a whole. A quarter of businesses are willing to accept crypto as payment, and many banks, family offices, and various investment vehicles are looking to invest in crypto or blockchain.
In addition, global crypto users are expected to hit 1 billion.
Kareem said that KPMG Canada isn’t stopping with having crypto on its balance sheet. The firm will also look at “very prudent ways of investing … in something that aligns with KPMG’s values.”
He didn’t rule out adding more BTC and ETH to the balance sheet, as well as building “capabilities across Decentralised Finance (DeFi), Non-Fungible Tokens (NFTs) and the Metaverse, to name a few.”
As yet, no one has provided further information about how much the firm invested in crypto assets.
KPMG Also Bought Carbon Offsets
At the same time, KPMG Canada also bought carbon offsets, in keeping with its environmental, social, and governance (ESG) commitments. Clearly, the firm has thought long and hard on this and intends to keep up with the trend for a long time.
The other three of the Big Four firms, PricewaterhouseCoopers, Ernst and Young, and Deloitte, are yet to get directly involved with crypto, but KPMG’s move could result in a domino effect. Institutional investment in crypto is expected to continue rising, even as the city of Rio de Janeiro wants to invest 1% of its treasury in crypto.
At the time of writing, BTC is up to $59,271.89 AUD, a 29% increase from its all-time low of about $42,041.97 AUD last year, and could continue to rally on the strength of this.