(Reuters) – Tesla Inc. said on Monday it had invested about $ 1.5 billion in bitcoin and hopes to start accepting payment for its cars and other products with it in the near future, which has generated a jump more than 10% in electronic money.
Analysts said the move by one of the world’s best-known companies could be a game changer for bitcoin.
A well-known bitcoin supporter, CEO Elon Musk has been regularly focusing last week on a retail investment frenzy, also increasing stocks in meme-based digital currency and stocks from the GameStop video game network
Musk said a week ago that bitcoin was “about” to be more widely accepted among investors and in December asked if it was possible to make large transactions in the currency.
“I think we will see an acceleration of companies looking to allocate in Bitcoin, now that Tesla has taken the first step,” said Eric Turner, vice president of market intelligence at data and cryptocurrency research firm Messari.
“One of the largest companies in the world now owns Bitcoin and, by extension, every investor who owns Tesla (or even just an S&P 500 fund) has exposure to it too.”
Bitcoin, which set new records in recent months after a roller coaster ride in the past decade, has also attracted the support of major financial institutions this year. The world’s largest financial manager, Blackrock, recently changed a handful of investment mandates to allow some of its funds to invest in the currency.
Central banks remain skeptical about digital currencies, but analysts say the more real-world uses they seem for bitcoin, the more attractive it will prove to be a long-term store of value.
Tesla said in a filing that the decision is part of its broad investment policy as a company and aims to diversify and maximize return on cash.
She said she has invested a total of $ 1.5 billion in bitcoins under the amended policy and can “acquire and maintain digital assets from time to time or in the long term”. (bit.ly/3q53p1m)
“He is now putting his (shareholder) money where his mouth is,” said Neil Wilson, an analyst at Markets.com.
“But given your recent comments – and adding #Bitcoin to your Twitter biography on January 29th – that also raises a real question about possible market manipulation.”
Bitcoin rose more than 10% on Monday to a record $ 43,625 after Tesla’s disclosure.
Musk has also endorsed other cryptocurrencies in the recent past. He gave dogecoin, the currency based on a popular internet meme, a message on Twitter last week, sending its price to a record high over the weekend.
Late Sunday afternoon, in a new endorsement of the currency, Musk tweeted “Who let the Doge Out” – imitating verses from the famous Baha Men song from 2000.
The coin also received attention from Californian rapper Snoop Dogg by placing the image of a dog with the tag “Snoop Doge” on his Twitter timeline.
Dogecoin was created largely as a satirical criticism of the 2013 crypto frenzy and is not taken as seriously as bitcoin or ethereum. It has almost doubled since Friday, reaching a record high of $ 0.0871, according to data from the blockchain and cryptocurrency website Coindesk.
Subrat Patnaik reporting in Bengaluru and Thyagaraju Adinarayan and Anna Irrera in London; Edition by Bernard Orr, Patrick Graham and Saumyadeb Chakrabarty