Gold jumped more than 1% Monday while ethereum, another cryptocurrency, surged to a record high.Ĭentral banks remain skeptical of digital currencies, but analysts say the more real world uses appear for bitcoin, the more attractive it will prove as a long-term store of value.īitcoin has rallied as far as $47,565 after Tesla's disclosure. ( ) Shares of the company rose 1.3% Monday. Tesla said it had invested an aggregate $1.5 billion in bitcoin under the changed policy and could "acquire and hold digital assets from time to time or long-term". "We expect to begin accepting bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis, which we may or may not liquidate upon receipt," the company said.
The report said it ended 2020 with $19.38 billion in cash and cash equivalents. Tesla said in a filing the decision to move nearly 8% of its reserves into bitcoin was part of its broad investment policy as a company aimed at diversifying and maximizing its returns on cash, including holding gold. Still, Gellasch said that "examination doesn't mean this is likely to be an enforcement case." "We're talking about a billionaire with one of the most valuable companies in the history of the world who has seemingly gotten away with poking the SEC before," said Tyler Gellasch, head of the Washington-based Healthy Markets Association and former SEC official. The Securities and Exchange Commission sparred with Musk and Tesla several times over his use of Twitter to discuss the company, ultimately resulting in his exit as company chairman and a pair of $20 million fines for Musk and Tesla. read moreĮxperts said they would not be surprised by a closer look from regulators given Musk's bumpy past with watchdogs. While discussions of cryptocurrencies are banned on the WallStreetBets community that fueled the GameStop Corp (GME.N) trading frenzy, users in other subreddits posted "to the moon," expecting more companies to follow suit after Tesla.Ī well-known supporter of cryptocurrencies, Musk has weighed in regularly on the past month's frenzy in retail investment, also driving up prices of the meme-based digital currency dogecoin and shares of U.S. The news sparked heavy trading in cryptocurrencies and caused exchanges like Coinbase, Gemini, Binance to experience technical issues, according to Coindesk. "But when the richest man in the world does it, everyone has to take a second look." "If any lesser mortals had made the decision to put part of their balance sheet in Bitcoin, I don't think it would have been taken seriously," said Thomas Hayes, managing member at Great Hill Capital LLC in New York. company, leaving other companies and investors eager to follow in his wake.
Musk has upended Wall Street over the last year and briefly became the world's richest person as shares of Tesla surged nearly 500% to become the fifth most-valuable U.S. Investors anticipated other companies will soon join a list of firms that invest in or hold bitcoin including BlackRock Inc (BLK.N), the world's largest asset manager, and payments companies Square (SQ.N) and PayPal (PYPL.O). At current prices, 0.8 bitcoins would be enough to buy an entry-level Tesla Model 3. The announcements, buried deep in Tesla's 2020 annual report, drove a roughly 20% surge in the world's most widely held cryptocurrency to over $47,000. Feb 8 (Reuters) - Bitcoin took another large stride toward mainstream acceptance on Monday after billionaire Elon Musk's electric vehicle company Tesla Inc (TSLA.O) revealed it had bought $1.5 billion of the cryptocurrency and would soon accept it as a form of payment for cars, sending the cryptocurrency shooting higher.
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