WeWork has partnered with BitPay and Coinbase, and will now allow cryptocurrency for inbound and outbound transactions. The co-working company continues its ever-longing quest to be portrayed as a cutting edge tech firm.
Dig Deeper: Through BitPay, a cryptocurrency payment service provider, WeWork will accept Bitcoin (BTC), Ethereum (ETH), USD Coin (USDC), Paxos (PAX), and several other cryptocurrencies as payment for its offerings, the company announced.
Worth Noting: WeWork will also hold the currency on its balance sheet. The company will pay landlords and third party partners in cryptocurrencies where applicable through Coinbase, a WeWork member and the largest U.S. cryptocurrency trading platform.
Backdrop: WeWork is trying to go public again and some of the factors that worried regulators last year have resurfaced. The shared-office provider plans to merge with a SPAC called BowX Acquisition Corp.
Doesn’t fundamentally change a flawed business: Coinbase will be the first WeWork member to use cryptocurrency to pay for its WeWork membership.
Don’t let crypto deflect from larger problems at play: The SPAC pitch describes the company as a “massive growth opportunity,” with “850+ locations,” more than a million workstations and over 450,000 memberships. Those tallies include WeWork’s China and India operations, which aren’t part of the entity that is being merged and aren’t included in its financial statements, WSJ noted.
Heard on the Street: UConn’s Corporate Finance Professor Minor Myers: “The recent investor presentation by BowX has echoes of the company’s approach in 2019. The SEC could push back hard again, unless WeWork tones down these claims in its official filings with regulators, expected later this month.”
Dig Deeper: WeWork is predicting a rapid recovery from the pandemic downturn, which hit its business particularly hard because few people were using offices, much less shared space, and because it was still on the hook for long-term leases. The company is also using a new profit measure that shows higher margins than it claimed in late 2019. [PR+WSJ]
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