Electric car maker Tesla announced on Monday that it has bought $ 1.5 billion of Bitcoin.
And in a file Presenting it to the US Securities and Exchange Commission, the company said it bought Bitcoin for more flexibility to diversify and maximize cash returns.
Tesla also said: It plans in the future to start accepting Bitcoin payments for its products, subject to applicable laws and on a limited basis initially.
This would make Tesla the first major automaker to accept doing so. The moves raised immediate questions about CEO Elon Musk’s behavior on the platform in recent weeks.
He is credited with increasing the prices of cryptocurrencies, such as Dogecoin, by spreading positive messages that encouraged more people to buy digital currencies.
Bitcoin prices rose nearly 7 percent to new highs on Monday after Tesla’s announcement, reaching more than $ 40,000.
Tesla shares rose more than 2.5 percent in pre-market trading, and Tesla warned investors about the volatility of the Bitcoin price in the file submitted to the US Securities and Exchange Commission.
Tesla’s move to Bitcoin represents a significant portion of its money invested, as the company had more than $ 19 billion in cash and cash equivalents at the end of 2020, according to its most recent regulatory file.
Tesla had previously reported that it was interested in the cryptocurrency, but buying such a large amount of cryptocurrency is remarkable.
In its file, Tesla wrote that earlier this year it updated its investment policy to provide it with more flexibility to diversify and maximize returns on unwanted cash to maintain adequate operating liquidity.
It added that it has the option of placing cash in some alternative reserve assets, which include digital assets, gold bullion, exchange-traded funds, and other assets as specified in the future.
The well-known electric car company invested a total of $ 1.50 billion in Bitcoin, and said it may acquire and hold digital assets from time to time or in the long term.
With this move, Tesla is following in the lead of MicroStrategy, a software company that has recently invested billions of dollars in Bitcoin.