Reason to trust
How Our News is Made
Strict editorial policy that focuses on accuracy, relevance, and impartiality
Ad discliamer
Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.
Elon Musk’s Tesla invested $1.5 billion in Bitcoin, according to its latest filing with the US Securities and Exchange Commission.
The American vehicle giant reported that it changed its investment policies in January 2021 to “further diversify and maximize returns” on the cash it did not require for operational liquidity. It later sought approval from its “audit committee” to invest those spare dollars in alternative reserve assets. The strategy led them to Bitcoin, the world’s most valuable decentralized cryptocurrency.
“We invested an aggregate $1.5 billion in bitcoin under this policy and may acquire and hold digital assets from time to time or long-term,” confirmed the Tesla filing.
The company further stated that it plans to allocate more of its cash reserves to Bitcoin. And, if necessary, it might also start accepting the cryptocurrency as a form of payment for its products in the future, providing they remain within their legal boundaries before taking the call.
The filing followed weeks of suspense over Mr. Musk’s cryptic messages on Bitcoin. On January 29, the Tesla founder changes his Twitter bio to the word ‘bitcoin,’ followed by a tweet that read that “in retrospect, it had to happen.” Later, Mr. Musk said in an online forum that he was late to purchase Bitcoin.
Bitcoin Hits ATH
Each one of his Bitcoin mentions sent the market into a buying frenzy. For instance, on January 22, the BTC/USD exchange rate popped up by more than 15 percent. The euphoria returned again on February 3 after Mr. Musk’s pro-Bitcoin comments, sending its prices higher by as much as 6.23 percent.
Bitcoin hits a new record high after Tesla's announcement. Source: BTCUSD on TradingView.com
Entering the new week, Tesla’s SEC filing repeated the BTC/USD pump scenario. The cryptocurrency shot past its previous record high near $42,000 and formed a new one near $43,823. While it followed a modest correction, traders poured in bullish comments across the social media that how Tesla’s involvement in the BTC space would send its prices to further high levels.
“Hope everyone is ready for a $50,000 Bitcoin,” said Alex Krúger, an independent macro analyst.
Tesla’s decision had it join the ranks of other major firms that either added Bitcoin to its financial reserves or enabled its services into their mainstream offerings. They include Nasdaq-listed MicroStrategy, payment firm Square, as well as billionaire hedge fund managers like Paul Tudor Jones and Stan Druckenmiller.
