Tesla Buys $1.5 Billion in Bitcoin
However, no one expected such an unbelievable move by Tesla that the company announced it had bought $1.5 billion worth of Bitcoin. This purchase has reassured Bitcoin investors and enthusiasts of the crypto currency’s potential to break new records. Tesla also stated that it would start accepting payments in bitcoin in exchange for its products. More importantly, Tesla’s move can trigger the domino effect that companies like Apple, Google, and Samsung might follow in adopting and investing in Bitcoin.
Purchasing Bitcoin has been on the agenda of corporate companies such as MicroStrategy and Square for a while, but as it is known, neither of these companies are on the S&P 500 list. Tesla, which made the last purchase, is the 4th largest company in the S&P 500, and the owner of the company, Elon Musk, is known as the richest in the world. Therefore, investing in Bitcoin and cryptocurrencies will be most probably taken into consideration by the big business. Many experts believe that there are reasonable factors for big companies to buy Bitcoin, but it will not occur overnight. Indeed, blockchain technology seems to be approved already by various companies.
Bitcoin price increased significantly to new highs following Tesla’s announcement, surging to a price of at least $44,200. Tesla’s $ 1.5 billion purchase means that 8 percent of its cash power will be transferred to Bitcoin. Considering all of the United States’ big and large companies, of course, this is like a drop in the ocean. Tesla’s purchase is worth just 0.05 percent of the $ 2.79 trillion cash and cash equivalents held on the balance sheets of the S&P 500 members, according to data compiled by Bloomberg. However, Bitcoin might be coming to the mainstream not only as a store of value but also as a medium of exchange.
It is a fact that financial and technology companies are faster than others for adopting Bitcoin. It will not be a surprise if a statement similar to Tesla’s is made by other big companies this year, like Facebook, Apple, etc. Many experts say Bitcoin will be used in transactions over the next years more widespread than today. Tesla’s move is a crucial signal that it will contribute to Bitcoin’s acceptance by the mainstream. We can witness a new era of integration between the cryptocurrency ecosystem and mainstream business. It is worth following how Tesla and Elon Musk’s- the world’s richest person- move will affect other companies’ attitudes and behaviors in the upcoming period. Follow Koinal to keep yourself updated on the latest developments.