Tesla to accept Bitcoins as payments in near future

Tesla to accept Bitcoins as payments in near future

Tesla to accept Bitcoins as payments in near future

In an unprecedented move, Tesla announced that the company has invested $1.5 billion in cryptocurrency Bitcoin. The year has proven to be beneficial for the pioneer digital currency.

Bitcoin has seen a surge of 35% since the start of this year.

Tesla recently updated its investment policy as per a filing with the Securities Exchange Commission.  The move is said to facilitate the company’s required flexibility to diversify the business and manage returns on surplus cash. The company also indicated that their policies of investment in alternative reserve assets and digital currency may change.

Elon Musk on Bitcoin
Elon Musk on Bitcoin

In another benchmarking move, the company will accept Bitcoins in exchange for its high-end products and services. The acceptance of Bitcoins in return for products or services will be under the applicable laws and its scope will be on a limited basis.

Tesla reportedly had cash equivalents in $19.4 billion as per its last earnings report of the year 2020.

It may be a big step boon for Bitcoin but it isn’t the first time a company has bought Bitcoin for investment purposes. MicroStrategy Inc. last August bought Bitcoins worth $1.15 billion which today are valued at $3.06 billion. The share price of MicroStrategy rose by 660% since August.

Similar to Tesla, Virginia-based MicroStrategy Inc. announced in August that it would use some of the excess cash on its balance sheet to invest in alternative assets such as bitcoin. The move has paid off so far. As of Feb. 2, the business analytics company said it held 71,079 bitcoins that it purchased for an aggregate price of $1.15 billion since last summer. Using the current value of $43,000, those bitcoins are worth $3.06 billion.

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On the other hand, many critics believe the share price of Tesla is incomparable with the automobile giants like Toyota and General Motors.

Recently, Elon Musk updated #Bitcoin in his Twitter bio which resulted in an increased value of the digital currency. On the contrary, the Indian Government may propose a bill banning all cryptocurrencies in the nation. However, the scope of the ban is not clear yet. Interestingly, we may see a launch of a new digital currency of India in the coming days.