E-car manufacturer Tesla has acquired $1.5 billion worth of Bitcoin, according to its SEC filing dated Feb. 8, becoming the first S&P 500 company to invest in the cryptocurrency.
Tesla claims that it might diversify its reserves by investing a portion of its cash into digital assets, gold and gold-backed exchange-traded funds (ETFs):
In January 2021, we updated our investment policy to provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity. As part of the policy, which was duly approved by the Audit Committee of our Board of Directors, we may invest a portion of such cash in certain alternative reserve assets including digital assets, gold bullion, gold exchange-traded funds and other assets as specified in the future. Thereafter, we invested an aggregate $1.50 billion in bitcoin under this policy and may acquire and hold digital assets from time to time or long-term.
Tesla to accept Bitcoin
Apart from adding Bitcoin to its treasury, Tesla will also start accepting cryptocurrencies as a form of payment:
Moreover, 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, which we may or may not liquidate upon receipt.
Earlier this month, Tesla CEO Elon Musk mentioned that the largest cryptocurrency was on the cusp of reaching mainstream adoption:
I think bitcoin is on the verge of getting broad acceptance by conventional finance people.
Tesla pushes Bitcoin to a new all-time high
Bitcoin reached a new all-time high, peaking at $42,500 on the Bitstamp exchange on the announcement. The cryptocurrency later extended its gains and soared to yet another lifetime peak of $43,730 at 1:02 p.m. UTC.
This is a developing story. Stay tuned for updates.