The year 2021 started with a bang when we heard many business tycoons and top companies entered into the Cryptocurrency domain. One man that always made news this year is Elon Musk, the owner of the electric auto company called Tesla. He invested a whopping 1.5 Billion USD in Bitcoin in December 2020, and since then, he has been making news in the media. He even announced that his customers could even pay him in digital currencies like Bitcoin as a payment option if they intend to procure any car from him.  SEC reports claim how the company accepted payments for his cars and vehicles in exchange for Bitcoin. The company allowed people the option to pay in Bitcoin and other digital currencies. Amid the news that Tesla invested a whopping amount in Bitcoin, not many knew what Elon Musk expected out of his investment. You can check the oiltrader to learn more about bitcoin trading.

Why the Investment?

Tesla came with a statement claiming that the shopping came once the announcement was made regarding the investment policy last month. He talked about more flexibility for diversifying the liquid and maximizing the returns on cash, which is required for the operations. Per one of the outfits based in California called Palo Alto claimed that they had 19.3 B USD in cash that they wanted to convert into digital coins by the end of 2020. However, talking about Tesla, it emerged as the first-ever auto company ranking in the top 500 globally that planned to invest in Bitcoin.

With this, we get Bitcoin and an aggregate purchase amount of 50 Million, leaving 1 percent of the total assets over the balance sheet in October 2020. Soon we saw the company called MicroStrategy also coming up around 1.3 Billion USD with its cash holding coming with Bitcoin. So it has come up like a treasury management policy. The same move seemed to have come from commentators that got the criticism that managing the stock amount of MS came with something high and that too without any change seen over the business conditions.

How did Tesla Invest a $1.5B Investment in Bitcoin?

The Key Takeaways

  • The electric vehicle giant has procured around 1.5 Billion USD worth of digital coins called the BTC. However, it was primarily done to boost up the returns they have got on cash and not to limit their operations.
  • With this, Tesla emerged as the first S and P Company, ranging with 500 to deal in digital coins.
  • Tesla chief Elon Musk has all the good things to think about the investment, and he is also reaping it to a great extent.

The corporate groups backed the investment along with the retail players and their investors looking for higher returns with their investment. As a result, they did gain stability in their income and set up new records for Bitcoin prices. And to a great extent, it did soar, and then we saw the roller coaster ride of the coin. It would be fair to say that the price of Bitcoin went at the pace of 160 per cent in 2020. Even the announcement coming from Tesla came with the price of 44k USD, and at times, it even reached 64 Percent, which is a decent rise.

However, the volatility factor attached to Bitcoin in particular had brought the price by 100 per cent. Remember, the cost had gone up to 64K USD, and then it came down somewhere close to 32K USD. October 21 witnessed something exciting with a roller coaster ride, and we had a good time gaining Bitcoin this year. As we see a good swing of price for Bitcoin, we were able to generate higher returns for a shorter amount of time and soon came the crash in valuation. In a sense, the investment reaching Tesla seemed to come from a more excellent place. One of the companies, Ten K filing, also followed the same path, but they could not metalize their returns.

Wrapping up

One may find the company’s investment reaching a rounding error to some extent, yet Elon Musk ended up making it on a decent note. The CEO has always remained optimistic about Bitcoin and Cryptocurrency at large. He has time and again tweeted about Bitcoin and digital coins in general. It kept his intention clear before the people, and then we saw the investment of 1.5 Billion USD in Bitcoin.


Like it? Share with your friends!

Rehan

0 Comments

Your email address will not be published.