Tesla
announced Monday it has bought $1.5 billion worth of bitcoin.
In
a filing with the Securities and Exchange Commission, the company said it
bought the bitcoin for “more flexibility to further diversify and maximize
returns on our cash.”
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.
Two
weeks ago, the billionaire Tesla owned added the hashtag #bitcoin to his
Twitter bio, a move that helped to briefly push up the price of the
cryptocurrency by as much as 20%. Two days later, he said on the social medial
chat site Clubhouse: “I do at this point think bitcoin is a good thing, and I
am a supporter of bitcoin.”
Bitcoin
prices surged to new highs 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.
Musk
has gotten into trouble for his market moving tweets in the past, but it’s
unclear how that applies to his tweets about cryptocurrencies. Most notably,
the SEC charged Musk with fraud in 2018 for his tweets about taking the company
private at $420 per share.
Musk
ultimately settled with the SEC, and was forced to give up his role as chairman
of the company’s board and pay a $20 million fine on top of another $20 million
fine for the company itself.
Source：CNBC
