Saudi Aramco on the Verge of Embracing Bitcoin?

The world’s largest oil and gas company seems to be on the verge of investing in bitcoin.

Petro-bitcoin?

The Saudi giant – with a market capitalization of more than $2 trillion – has gone into business with SBI Holdings, a Japanese financial services company.

The agreement between Aramco and SBI Holdings provides that the two companies will collaborate “in the field of digital assets”. In other words, there’s a chance that Saudi Aramco intends to place a portion of its treasury in bitcoin.

Indeed, SBI Holdings has recently allied with the American bank Standard Chartered to create a joint company in the United Arab Emirates. Standard Chartered plans to offer custody of digital assets for institutional clients starting in the first quarter of 2024.

All this is parallel to the fact that Standard Chartered anticipates bitcoin reaching $100,000 by the end of 2024…

The second part of the agreement concerns the creation of a semiconductor factory in Saudi Arabia. It’s safe to say that this is not a small deal.

Michael Saylor’s efforts to convince multinationals to emulate Microstrategy by placing their treasury in bitcoin seem to be paying off.

The recent accounting evolution by the FASB should accelerate things further. Until now, only the depreciation of bitcoins appeared in the balance sheets of companies. The losses were accounted for, but not the gains.

Now, American companies will be able to declare their bitcoins at their fair value (“Fair value accounting”). This could encourage them to place part of their treasury ($20 trillion) in bitcoin.

As for Aramco, it’s about $3.2 trillion that the Saudi company will be looking to invest by 2030. So much money that could end up partly in bitcoin.