Elon Musk’s Tesla buys $1.5bn of Bitcoin causing currency to spike
- Date: 08-Feb-2021
- Source: BBC
- Sector:Financial Markets
- Country:Middle East
Elon Musk’s Tesla buys $1.5bn of Bitcoin causing currency to spike
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Elon Musk's car firm Tesla has said it bought about $1.5bn (£1.1bn) of the cryptocurrency Bitcoin in January and expects to start accepting it as payment in future.
The news caused the price of Bitcoin to jump 17% to $44,220, a record high.
Tesla said it was trying to maximise returns on cash that is not being used in day-to-day running of the company.
It comes days after Mr Musk added "#bitcoin" to his Twitter profile page, which drove up the price.
He removed it days later, but has continued talking up Bitcoin and other cryptocurrencies, including Dogecoin, which jumped 50% after his endorsement.
In a stock market filing, Tesla said it "updated its investment policy" in January and now wanted to invest in "reserve assets" such as digital currencies, gold bullion or gold exchange-traded funds.
It said it had already bought $1.5bn of Bitcoin and could "acquire and hold digital assets" in the future.
"Moreover, we expect to begin accepting Bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis," it said.
Mr Musk said a week ago in a tweet that Bitcoin was "on the verge" of being more