Tesla, the famous American electric car company has today announced a huge investment into Bitcoin as per their SEC filing.
The company says that they bought $1.5 billion (Kshs 164 billion) worth of Bitcoin for “more flexibility to further diversify and maximize returns on our cash,” as per the filing.
They also said that they will start accepting payments in Bitcoin in exchange of their products as well. This makes them the first major automaker to accept Bitcoin as payment.
This announcement led to the price of Bitcoin skyrocketing from below $40,000 to over $43,000 as of writing this article. Bitcoin has seen an immense price surge in 2020 and this investment by Tesla could prove to be quite smart if they decide to hold onto the investment for long.
This move is not a surprise since Tesla’s CEO, Elon Musk is a huge fan of cryptocurrencies like Bitcoin and the meme coin Dogecoin. At one point, he had Bitcoin as his bio on his Twitter page and tweets about cryptocurrency often.
This investment by Tesla is significant for the company. They had more than $19 billion in cash and cash equivalents as of 2020 and they decided to invest some of that to Bitcoin. The decision to allow people to pay for their electric cars by Bitcoin is also quite significant and will be met by difference in opinion in the industry.