Tesla Inc (NASDAQ: TSLA) investor Ron Baron says the company’s decision to invest $ 1.5 billion in Bitcoin (BTC) and accept digital currency as a payment option “is not surprising”.
Musk likes bitcoin: Tesla CEO Elon Musk has been “commenting favorably” on bitcoin for some time, Baron said in a statement to CNBC. It is likely that Tesla is not “speculating about the price of bitcoin”, but using it as a payment system.
Other big investors, like Stanley Druckenmiller and Paul Tudor Jones, CIO of Tudor Investment Corp., are equally optimistic about bitcoin, while companies like Paypal Holdings Inc (NASDAQ: PYPL) are developing their digital currency offerings.
“I’m sure a lot of thought has been given to the purchase of bitcoins by Tesla and I’m looking forward to learning why,” according to Baron, the CEO, President and Portfolio Manager at Baron Funds.
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Gene Munster of Loup Ventures also liked the move.
“Tesla has money to lose with $ 19 billion in assets,” Munster told Benzinga. “Yes, Bitcoin can move the needle to Tesla. If it goes up 10 times, that means Tesla $ 15 billion. That’s real money.”
Bitcoin investment: Tesla’s decision to allocate about 7.5% of its total bitcoin money and can be seen as a signal to customers that it “understands where the world is going,” said Galaxy Digital CEO Michael Novogratz, to CNBC. People want to do business and invest in companies that are looking forward to the next 100 years – not the last 100 years.
On the other hand, Musk should not tweet about Dogecoin as the appreciation of the digital currency has reached a point where some people will lose a lot of money, he said. The digital currency has no real purpose, unlike bitcoin or Ethereum and others.
“It was a little funny,” said Novogratz.
Difficult to prove any manipulation: Musk has been optimistic about bitcoin for some time now and this raises the question of whether his public comments can be seen as market manipulation. Muddy Waters Research founder Carson Block said he did not think that was the case.
Musk is far from the only notable person in the investment community to comment publicly on what he is optimistic about. Musk’s comments are no different from Chamath Palihapitiya, confirming that he is long GameStop Corp. (NYSE: GME) call options.
Meanwhile, the United States Securities and Exchange Commission “does not have a track record of success” against Musk, Block told CNBC. As such, any investigation would likely lead to a “dead end”.
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