Galaxy Digital, the cryptocurrency investment manager, is sponsoring Time Magazine to publish content about the metaverse. The announcement states that the transaction used the cryptocurrency ETH and that Time will hold ETH on its balance sheet. We’ll return to that topic.
While Time Magazine is a big brand, it’s a standalone company that’s privately owned by Salesforce founder Marc Benioff.
Benioff recently slammed Facebook (now called Meta) on CNBC and CNN, stating that the social media company created misinformation and mistrust. In 2019 he called for Facebook to be broken up.
Is it a coincidence that this news comes a few weeks after Facebook outlined its metaverse plans and rebranded as Meta?
TIME’s metaverse plans
The deal involves TIME creating a TIME 100 Companies for the Metaverse, and startups can submit applications starting today. It will also create a new weekly newsletter, ‘Into the Metaverse’, and host educational content on the topic.
“Over the next decade, the metaverse will become an increasingly important part of the world economy; our physical and digital realities are already becoming hard to distinguish,” said Mike Novogratz, CEO and Founder of Galaxy Digital.
“We look forward to partnering with TIME, an iconic brand driving innovation, as we seek to bring readers, creators, and the curious into the metaverse and demystify the tremendous amount of transformation happening within.” Galaxy’s affiliate Galaxy Interactive is a major investor in metaverse companies.
Time has been a relatively early adopter of crypto and non-fungible tokens (NFTs). In March, it sold three TIME covers as NFTs and accepts cryptocurrency for digital subscriptions.
ETH on balance sheet – does it matter?
It’s a smart move by Galaxy Digital to incorporate the ETH element as part of the deal, and it already garnered headlines from cryptocurrency publications. However, the amount of ETH was not specified. Does a few tens of thousands of dollars worth matter?
While Tesla, Square and Micro Strategy have put Bitcoin on their balance sheet, so far, most big companies are reluctant to do so. Outside of ETFs linked to Bitcoin Futures, Micro Strategy is the closest thing to a Bitcoin ETF.
The reluctance to hold cryptocurrencies is for two main reasons. Firstly, not all large companies have massive cash balances, which means they need to make sure the cash is there when they need it. That precludes volatile assets such as cryptocurrencies. If a corporate treasurer couldn’t produce the required cash because crypto prices tanked, he’d be fired.
But even for those with bulging bank balances, there’s another reason. As Apple’s CEO Tim Cook said last week, “I don’t think people buy an Apple stock to get exposure to crypto. If they want to do that, they can invest directly in crypto.” However, he said he owned some himself.
Now if those companies used cryptocurrencies daily, they might need to hold it on their balance sheet, which would be a different story.