Ant Financial is not present in the cryptocurrency space. Should it be? Why?

Expert Solution

Ant financial is not available in crypto currency trade due to following reasons:

Ant Financial is one of the largest tech finance corporation in the world. Its business lines are electronic payments, billing processing and banking. Shares of this company is listed in NYSE.
Cryptocurrency trading is highly price volatility. So that it is very difficult for the stakeholders to estimate the values of assets. Inherent value of securities also affect the market negatively.
As Ant Financial is a china based organisation, cryptocurrency trading is not legally authorized there. So that it will be risky for the corporation to trade without cross border agreement signed.
There is no reverse payment gateway in cryptocurrency investment. Once payment is done to some other party there is no other way to get it back.
Apart from it there is huge swings in the market price for crypto currency, as a result there is chance of loss for institutional investors regarding their investment portfolio.
Bitcoins might leads to heavy out of pocket expenses for the corporations. Hence net profit margin will be reduced and the organisation will not be able to meet their short term debt obligations.

Thus these are the major reasons for which Ant Financial is not present in cryptocurrency investment activity.

All the best for your exam! Thank you!

jeff jeffy answered 10 months ago

Why would the SEC care about cryptocurrency? Is the SEC's oversight of cryptocurrency consistent with its...

Why would the SEC care about cryptocurrency? Is the SEC's oversight of cryptocurrency consistent with its role/duties?

How should holdings of cryptocurrency be initially and subsequently measured under U.S. GAAP?

Should financial institution’s try to avoid all sources of financial risk? Why or why not?

What are the factors that promoted the use of cryptocurrency by comsumers? Furthermore, why are governments...

What are the factors that promoted the use of cryptocurrency by comsumers? Furthermore, why are governments concerned about the use of Bitcoin? Thank you :)

How should a Company’s holdings of cryptocurrency be classified on the balance sheet under U.S. GAAP?

Should a financial analyst approach their work with a degree of skepticism, why or why not?...

Should a financial analyst approach their work with a degree of skepticism, why or why not? What will be the main areas of skepticism as you review the SEC 10K report from southwest airlines?

Discuss the reason why capital investment projects should be evaluated for risk in the present, and...

Discuss the reason why capital investment projects should be evaluated for risk in the present, and how risk might be involved in future planning and/or forecasting. Pick a typical healthcare project to evaluate and consider the risk factors involved in the situation. How could you determine what is most important and might be the most critical sources of risk? Based on what you find, how would management mitigate those risks?

“The consolidation process is time consuming and repetitive. Companies should not have to present consolidated financial...

“The consolidation process is time consuming and repetitive. Companies should not have to present consolidated financial statements as users can look at individual entities’ financial statements for their decision making.” Comment.

comment on why "Quality performance should be expressed in financial terms "

Why should consolidated financial statements be prepared? Do they exhibit financial strength of goodwill?

Question