In a filing with the Securities and Exchange Commission, Tesla announced that it bought $1.5 billion in Bitcoin. The company plans to accept the currency as a payment method for its product, making it the first automaker to do so.
After the announcement, Bitcoin shares rose 15%, and Tesla shares jumped 2%. Tesla is worth $820 billion. In its fourth-quarter earnings report, the automaker said it had $19.4 billion in cash and cash equivalents.
According to the Associated Press, Dave Ives of Wedbush Securities said the investment gives Tesla “more flexibility to further diversify and max returns on its cash.”
“[T]his move could put more momentum into shares of Tesla as more investors start to value the company’s bitcoin/crypto exposure as part of the overall valuation,” Ives said.
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