The reflection of bitcoins in a computer hard drive.
Thomas Trutschel | Photothek via Getty Images
Bitcoin’s price jumped sharply to an all-time high after Tesla revealed a big stake in the digital coin and said it would start accepting payments in bitcoin in exchange for its products.
The world’s largest cryptocurrency last traded 12% higher at $43,250, according to Coin Metrics. Bitcoin just finished a banner year with its price more than quadrupling in 2020.
Tesla announced Monday that it bought $1.5 billion worth of bitcoin, according to a filing with the SEC. The electric car maker said it bought bitcoin for “more flexibility to further diversify and maximize returns on our cash,” according to the filing. It added that it may invest future portion of its assets in digital assets.
The move also makes Tesla the first major automaker to accept bitcoin as payment.
CEO Elon Musk has been talking up bitcoin as well as meme-inspired token “dogecoin” in recent tweets, which many believe drove the recent run-up in these assets.
Bitcoin’s meteoritic rise in the past year came amid major involvement in the industry from the likes of Fidelity Investments, Square and PayPal. Interest from high-profile investors such as Paul Tudor Jones and Stanley Druckenmiller also helped boost the digital coin. Many even believe bitcoin has the potential to replace safe-haven gold by some institutional investors.
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