In January 2021, after buying Bitcoins worth $1.5 Tesla updated its investment policy for the investment in digital assets. On Monday Tesla announced it officially that they had been bought Bitcoins worth $1.5 billion and will soon accept the cryptocurrency as payment to buy a Tesla. Tesla buys Bitcoin might be a piece of news to ignore for some people but it is one of the most valuable pieces of news for Bitcoin users as for the first time the price of Bitcoin reaches around $44,500 which is around 15.4% more than before.
Tesla also revealed a new strategy in a filing with the U.S. Securities and Exchange Commission, in which they said that they are probably going to going to invest more in digital currency and other “alternative reserve assets” which lead them to grow more. It’s a great initiative by Elon Musk towards cryptocurrency as the purchase of a vehicle is large and using Bitcoin to do so will help in more push and is a better fit to pay for it.
We still don’t know that will other companies also took the same step as Tesla and accept Bitcoin as a payment method, as there is another reason also to not accept Bitcoins which is its wild price swings which may be a big reason for any big merchant to think over twice before accepting it.
Tesla Buys Bitcoin
We can say Tesla is one of the unique car manufacturing companies that is going to accept digital currency as the payment unlike the traditional car companies like Ford and General Motors as usually, the automaker does not rely on a network of independently owned dealerships to sell its vehicles.
Last month Tesla made an announcement in which they said that they have cash reserves of more than $19.4 billion which comes after selling new shares to take advantage of a rising stock price. Also, Dan Ives of Wedbush Securities said about this announcement that due to the current situation of cash reserves “Tesla has more flexibility to further diversify and maximize returns on its cash.”
Musk is known for his eclectic tastes as he did such things before also which drives everyone crazy as he launched his Tesla car in space to demonstrate the payload capabilities of his SpaceX company rockets. So, we can expect this much investment in Bitcoins is obvious all we have to see is whether the step of accepting cryptocurrency will pay back to Musk company Tesla or not.
Just like Tesla, Virginia-based MicroStrategy Inc. also announced in August that they are going to invest their excess cash reserve in alternative assets like Bitcoin. They get profit so quick as on February 2 they decided to sell its 71,079 bitcoins which they purchased for an aggregate price of $1.15 billion. With a price value of $44,500, they get their Bitcoins worth around $3.16 billion.