Tesla Buys USD 1.5B Worth of Bitcoin, Might Accept BTC as Payment

US-based major electric car manufacturer Tesla said it invested an aggregate USD 1.50bn in bitcoin (BTC) and expects “to begin accepting bitcoin as a form of payment for our products in the near future.” (Updated at 13:35 UTC: updates throughout the entire text. Updated at 14:03 UTC with liquidation data, comments, and Google Trends data.)

In a filing with the US Securities and Exchange Comission, the company said that, in January 2021, it “updated investment policy to provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity.”

According to Tesla, they may acquire and hold digital assets from time to time or long-term.

“We believe our bitcoin holdings are highly liquid. However, digital assets may be subject to volatile market prices, which may be unfavourable at the time when we want or need to liquidate them,” the company said.

As for the accounting, the car manufacturer said that the cost basis of the digital assets will not be adjusted upward for any subsequent increases in their quoted prices on the active exchanges. “Gains (if any) will not be recorded until realized upon sale,” they added.

Following the news, BTC hit its new all-high, rallying above USD 43,300 (13:32 UTC). It’s up by more than 10% in a day and 28% in a week.

Meanwhile, in the past hour, almost USD 228m worth of BTC short positions were liquidated, according to bybt.com data.

Last week, Tesla founder Elon Musk said that BTC is on the verge of getting a broad acceptance by the “conventional finance people.”

 

Original article