Tesla Announces Purchase of $1.5 Billion in Bitcoin; Plans on Selling Cars for the Cryptocurrency

PALO ALTO, CA – According to reports, electric car manufacturer Tesla made an announcement on Monday that it purchased $1.5 billion worth of the bitcoin, and noted that customers could one day soon actually buy one of their vehicles with the cryptocurrency. Tesla, according to a filing with the Securities and Exchange Commission, noted that the bitcoin purchase was made to add “more flexibility to further diversify and maximize returns on our cash.”

The company also announced that they would begin to accept bitcoin payments for their products, although this policy would be “subject to applicable laws and initially on a limited basis.”  

Spending $1.5 billion on bitcoin is a significant investment on the part of Tesla and their available resources, which reported over $19 billion in cash and ‘cash equivalents’ in their possession at the close of 2020, reports say.

CEO Elon Musk has been promoting digital currencies on social media recently leading up to this announcement, which many believe has helped increase their value; a #bitcoin hashtag in his Twitter bio added two weeks ago reportedly helped to temporarily drive up its price by approximately 20 percent.

“The moves raised immediate questions around CEO Elon Musk’s behavior on Twitter recent weeks, 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,” CNBC reported.

Bitcoin prices hit record highs – $43,700 – on Monday after Tesla’s announcement; Tesla’s own shares jumped two percent.

In an interview on social app Clubhouse, Musk was recently quoted as saying “conventional finance people” are on the verge of broadly accepting cryptocurrency, and said he wished he had invested in it sooner.

“I do at this point think bitcoin is a good thing,” he said. “I’m late to the party, but I am a supporter of bitcoin.”