Published 07:47 IST, February 9th 2021
Tesla buys $1.5 billion in bitcoin, to accept cryptocurrency as payment for Tesla cars
In a Securities and Exchange Commission filing with DC office, electric car manufacturer Tesla said that it was buying cryptocurrency for “more flexibility".
- Republic Business
- 3 min read
Tesla announced in an SEC filing Monday that it bought $1.5 billion in Bitcoin, adding that it will start accepting bitcoin as payment for the purchase of Tesla motors. This comes after CEO Elon Musk soared the prices of cryptocurrencies, including bitcoin, via his tweets on social media. In a Securities and Exchange Commission filing with the DC office, the electric cars manufacturer said that it was buying the cryptocurrency for “more flexibility to further diversify and maximize returns on our cash.” It added, the company will accept bitcoin in exchange for its products “subject to applicable laws and initially on a limited basis.” The firm stated that cryptocurrency trade will give Tesla liquidity. Post massive investment in Bitcoin after consultation with Tesla’s Board of Directors, bitcoin surged to a record price of $43,000, according to CoinDesk. A year ago, Bitcoin was worth close to $9,900.
[Image Credit: CoinDesk]
Dogecoin price soar to $0.06
Tesla, meanwhile, said that it "may acquire and hold digital assets from time to time or long-term." Earlier, in his tweets, Tesla chief Elon Musk added the term Bitcoin to his Twitter bio (and then deleted it shortly thereafter), which led to a jump in the cryptocurrency price by as much as 20 percent. Adding to this, Musk said on Clubhouse, an audio-based social app, that "Bitcoin is a good thing" and that he was "late to the party”. “I do at this point think bitcoin is a good thing, and I am a supporter of bitcoin,” Musk said on chat site Clubhouse. Following his announcement about ‘break’ from Twitter, Musk launched tweets regarding ‘Dogecoin’ as he resumed operating the microblogging site just two days after his dismissal. “No highs, no lows, only Doge,” Musk tweeted, following which the Dogecoin rose to almost $0.06, and altogether the coins are now worth more than $7 billion. Musk’s tweets back Tesla’s recent investment of a significant percentage on the digital currency.
As Tesla’s shares soared more than 2 percent Monday, the firm warned investors about bitcoin’s volatility. Meanwhile, as Tesla invested in the digital currency, the investment attracted some backlash as critics took to social media to criticize the environmental hazards of Bitcoin mining and excessive energy consumption. “Bitcoin is such an environmental disaster, it really is a crime against humanity. So what does Tesla do with their $1.5B in revenue last year from clean car credits sold to other automakers? Put it into ‘Destroy the Planet Inc,’” computer scientist at the University of California, Berkeley, Nicholas Weaver said. Musk, in due course, launched a poll calling Dogecoin the ‘future currency of the moon.’
Updated 07:47 IST, February 9th 2021