Tesla announced it had bought $ 1.5 billion in bitcoin and would accept the cryptocurrency as payment, according to an SEC filing Monday.
The company said it bought the bitcoin for “more flexibility to further diversify and maximize the return on our cash.” The news makes Tesla the first carmaker to adopt the cryptocurrency.
Carson Block, founder of Muddy Waters Research, doubts any federal interference in CEO Elon Musk’s plans.
“The SEC just does not have a record of success against Elon Musk, so I expect any attempt to go in that direction, it would basically be a dead end.”
Dan Ives, managing director of equities research at Wedbush, sees the benefit of the stock.
“It’s Tesla and Musk diving into crypto in the deep end of the pool, and it’s something that’s been rumored for a while, and in the end it’s really them who are putting his opinion behind it. I think it’s something that the street will have a different view. of, but ultimately … it will certainly be considered a positive factor for the stock. ‘
Mike Novogratz, founder of Galaxy Digital, sees this as a groundbreaking step that other companies will take.
“Every company needs to look at how to accept digital currencies, digital payments as part of their business scheme. It’s not that difficult. It’s what customers want, it’s where the world moves. And so I think he’s ahead of the bow, and I think you’ll see that every company will see how it goes, from McDonald’s to Bojangles, you name it.
Mohamed El-Erian, chief economic adviser at Allianz, said it should give bitcoin a boost.
“What did Tesla tell you? Two things. One is that it will be a means of payment. And two is that it is an investment vehicle. So these are two powerful notes for the idea. I want to emphasize the idea that bitcoins are a currency, a money, because money is a store of value. Money is a form of payment. So yes, it will build further momentum. As far as the reaction goes, it’s going to be everywhere. Some will see as a visionary, others will say: wait a minute, if I want to invest in bitcoin, I will do it directly, I do not need Tesla to do it for me …. So you are going to see a whole series of reactions , but for bitcoin holders, [Monday’s] good news. “
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