Electric vehicle and clean energy company Tesla disclosed in a recent SEC filing that it has bought $1.5 billion worth of Bitcoin. “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,” reads the filing.
“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.”
In addition to the Bitcoin purchase, Tesla revealed plans of accepting the leading cryptocurrency as a form of payment for its products. “In the near future, subject to applicable laws and initially on a limited basis, which we may or may not liquidate upon receipt.”
Tesla CEO Elon Musk Sends Bitcoin Price Surging
Tesla CEO Elon Musk first inquired about converting “large transactions” of Tesla’s balance sheet into Bitcoin in December during a Twitter exchange with Microstrategy CEO Michael Saylor.
Saylor encouraged Musk to shift cash from Tesla to Bitcoin and “do your shareholders a $100 billion favor”. Shortly after that exchange, Musk wrote in a separate tweet: “Bitcoin is my safe word.”
Last week, Musk made headlines after adding the Bitcoin hashtag to his Twitter bio. He said shortly after: “I think Bitcoin is really on the verge of getting broad acceptance by sort of the conventional finance people.”
Musk has since removed the Bitcoin hashtag from his Twitter bio, but continues using the platform to discuss cryptocurrencies. He most recently posted a series of Dogecoin-related tweets, but noted they shouldn’t be taken seriously.
Following the news that Tesla purchased over a billion dollars worth of Bitcoin. The price of BTC surged around 10% and currently is trading at about $42,500. Bitcoin nearly reached $45,000 before slightly pulling back.
The price surged extended above the high price from January $41,986.38, which is now close support. Looking at the daily chart of the digital currency from Coinbase. The low cracked price in January stalled right near its 50 day moving average and bounced.
For longer term traders stay above that moving average increases the levels of importance going forward. It currently stands at $33,240.48.