.Tesla buys $1.5 worth of bitcoin
.Tesla may accept bitcoins for product in the future
.1 Bitcoin surge up to at least $44,200
Tesla, announced on Monday that it bought $1.5 billion worth of bitcoin.
Tesla said it bought the bitcoin for “more flexibility to further diversify and maximize returns on our cash.” This was disclosed in a filing with the Securities and Exchange Commission.
Tesla also said it will start accepting payments in bitcoin in exchange for its products “subject to applicable laws and initially on a limited basis.”
That would make Tesla the first major automaker to do so.
The $1.5 billion worth of bitcoin will give Tesla liquidity in the cryptocurrency once it starts accepting it for payments.
Tesla’s move into bitcoin represents an investment of a significant percentage of its cash in the investment.
The company had more than $19 billion in cash and cash equivalents on hand at the end of 2020, according to its most recent filing.
The moves raise questions around CEO Elon Musk’s recent behavior on Twitter, where he has been credited for increasing the prices of cryptocurrencies like bitcoin and dogecoin by posting positive messages that have encouraged more people to buy the digital currencies.
Bitcoin prices surged to new highs on Monday, following Tesla’s announcement, reaching a price of at least $44,200.
Tesla shares were up more than 2% Monday morning. In its SEC filing, Tesla warned investors of the volatility of bitcoin’s price.