CEO of Tesla and SpaceX, Elon Musk, has finally put his money where his mouth is with regards to cryptocurrency as an SEC annual report shows Tesla investing about $1.5 billion into Bitcoin.
Musk has recently been publicly extolling the virtues of meme coin $DOGE to a point where he has greatly impacted its price. This also comes off the back of a war aged between redditors from WallStreetBets going after hedge funds trying to short GameStop.
Musk has been in the cryptocurrency spotlights for some time, but has never made any concrete moves towards investing or buying. But, this latest report shows Musk following in the footsteps of a number of institutions that have jumped at the chance of owning Bitcoin in recent times.
MicroStrategy CEO Michael Saylor is one of the trailblazers for institutional investment in Bitcoin, but his firm’s purchase of BTC seems to have had a snowball effect culminating in Tesla’s decision to buy and hold.
Musk even went as far as to ask about the logistics of purchasing such amounts of Bitcoin with an exchange with Saylor in December last year.
“In January 2021, we updated our 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,” reads the filing. “Thereafter, we invested an aggregate $1.50 billion in bitcoin under this policy and may acquire and hold digital assets from time to time or long-term.”
Impacting the price
Musk’s impact from his tweets has been sending $DOGE higher, but this recent news has also impacted the price of Bitcoin as the coin shot up to its near all time high of around $42,000.
“Bitcoin is heading towards the sky, another Billionaire has come out and he has put his money where his mouth is. Traders have been waiting for Elon Musk to make some big news and today the proof is out. Tesla’s investment in Bitcoin is a further proof that Bitcoin is a currency and it can be accepted for payment. There is nothing which is going to Bitcoin from rising now. The next stop is 50K and then we are moving towards the 65K” explained Naeem Aslam, Chief Market Analyst at Avatrade.
As Bitcoin continues to gather steam with mainstream institutions who are looking to it as an asset to hold and grow, it is likely that the coin will continue to be legitimized and increase in value. Musk has often been labeled as quite out there, but his ideas are often well respected and known to set trends.