Tesla Bets Big on Bitcoin, Plans to Accept Cryptocurrency

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Feb 08 2021, 6:45 PMFeb 08 2021, 8:26 PMFebruary 08 2021, 6:45 PMFebruary 08 2021, 8:26 PM

(Bloomberg) -- Tesla Inc. invested $1.5 billion in Bitcoin and signaled its intent to begin accepting the cryptocurrency as a form of payment, sending prices to a new record after the vote of confidence from the electric-car market leader.

The Palo Alto, California-based manufacturer said in a filing Monday it made the bet on Bitcoin after updating its investment policy last month to allow the company to invest in digital assets as well as gold bullion and gold exchange-traded funds.

“We expect to begin accepting Bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis,” Tesla said in the securities filing.

The leading electric-car maker’s embrace of Bitcoin lends increased legitimacy to electronic currencies, which have become more of a mainstream asset in recent years despite skepticism from some. The embrace of a digital currency fits the maverick image of Tesla Chief Executive Officer Elon Musk, who upended the automotive industry with battery-powered vehicles and disrupted the equities market with the stock’s ascension to the blue chip S&P 500 index last year.

Bitcoin rose as much as 16% to an all-time high of $44,795.20 on the news. It was up about 12% at $43,218.69 at 8:59 a.m. in New York.

Read more: Crypto Stocks Rally With Tesla Pushing Bitcoin Above $42,000

Musk has often tweeted about cryptocurrency-related topics and earlier this month called Bitcoin “a good thing” in an interview. Dogecoin, the once tongue-in-cheek cryptocurrency, hit a record on Monday after Musk, rapper Snoop Dogg and Kiss bassist Gene Simmons all tweeted about it.