Elon Musk is serious about cryptocurrency.
On Monday, Musk moved from jokey tweets to major investments when Tesla disclosed in an SEC filing that the company invested $1.5 billion in bitcoin in January, and aims “to begin accepting bitcoin as a form of payment for our products in the near future.”
This amounts to 10% of Tesla's cash reserves, and is the largest corporate purchase of bitcoin ever.
Bitcoin (BTC) spiked 14% on the news to a new all-time-high above $44,000, and Tesla (TSLA) shares jumped 2%.
The $1.5 billion bitcoin buy puts Tesla in the company of two other consumer-facing tech companies that have loaded up on bitcoin in the past year: Square (which bought $50 million worth in October, amounting to 1% of its cash reserves) and cloud services provider MicroStrategy, which has kept buying more bitcoin in the last few months and now holds 71,079 bitcoin, worth more than $3 billion as of Monday morning.
Planning to accept bitcoin as payment puts Tesla in league with PayPal, which began allowing its customers to buy and sell bitcoin, ether (ETH), litecoin (LTC), and bitcoin cash (BCH) in its PayPal wallet in December, and will add the function to Venmo this year, along with the ability to make purchases with crypto.
On PayPal’s Q4 earnings call last week, CEO Dan Schulman said crypto trading volume has “exceeded expectations” and that the company’s crypto efforts so far are “just the beginning of an extensive roadmap” around crypto.