Tag archives: bitcoin

Funding M&A Deals with Bitcoin

As Bitcoin gains increasing traction since its inception 11 years ago, we begin to question whether it will slowly replace traditional dollar funding in M&A deals. Whether Bitcoin will be used to fund large M&A deals will likely depend on its ability to stabilize in value.

One of the most common concerns of using Bitcoin as a source of deal funding is its propensity to fluctuate in value. Over the past five years, Bitcoin prices have fluctuated from CAD $500 to CAD $72,000, sometimes even dropping as much as 50% over the course of a single day. This price … Continue Reading

Taxation of cryptocurrency: unchartered territory and treacherous waters

With the recent market uproar for blockchain technology and cryptocurrency, the tax question is becoming more and more pertinent. Whether one is trading in cryptocurrency, issuing it in an effort to raise capital, hanging onto it as a long term investment, mining it or using it to access software apps, numerous questions arise.

Answering these questions with any measure of certainty, however, is tough. No legislation has been introduced  and no Canadian case law has yet been decided on cryptocurrency (although one surmises that that won’t be the case for long). The Canada Revenue Agency (CRA) has released … Continue Reading

Crypto update: January crash, securitized tokens and threats to traditional VC

Bloodbath in the CryptoMarket

For the past three years in January, Bitcoin experienced significant price corrections. This year is no different – except for its magnitude. Likely exacerbated by an influx of new investors and a spike in actively traded altcoins, Bitcoin depreciated by almost 50% from its all-time high in mid-December.

According to CoinMarketCap, the total market value of cryptocurrencies nosedived from USD $832 billion on January 7, 2018 to USD $450 billion on January 17, 2018, erasing USD $360 billion in value.

The price of the two other largest cryptocurrencies, namely, Ethereum and Ripple, dipped as much as … Continue Reading

Blockchain technology: an imminent driver of investment and M&A

Blockchain technology has been making headlines since it emerged in 2009 in connection with the cryptocurrency Bitcoin. We’ve covered the potential use of Bitcoin in M&A transactions in previous articles in 2016 and 2014. As discussed in these articles, the volatility and lack of central authority has so far meant that the cryptocurrency plays a niche role in the capital markets.

However, blockchains – the technology behind Bitcoin – has been gaining ground for its exciting enterprise potential. We are already beginning to see companies racing to adopt this emerging technology, as more and more companies acquire the technology … Continue Reading

Bitcoin update: cryptocurrency remains rare in M&A transactions despite potential

Bitcoin remains a fringe currency in the context of M&A transactions. Despite some notable advantages over fiat currency, the risks associated with funding a large transaction using the cryptocurrency have limited its use to deals between players in the Bitcoin space. This article provides an update to our previous article on Bitcoin’s viability as a currency for funding M&A transactions.

To date, there have been three notable M&A transactions funded with Bitcoin. Only one of these transactions was completed within the last year, with the other two closing in 2013. The initial excitement over Bitcoin’s use in M&A deals was … Continue Reading

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