Everyone is talking about Tesla and bitcoin. While the news is more than 48 hours old, many are commenting that the latest move from the electric car company and its CEO Elon Musk is going to mark a significant time for the world’s leading digital currency by market cap.
Tesla and Bitcoin Are Becoming the Perfect Match
The currency has been making real waves for itself in the land of institutional investors, many of whom now see BTC as a hedge tool or store of wealth rather than just a speculative asset. This initially began with companies such as MicroStrategy, which at the time of writing, has invested more than $3 billion into the digital currency.
However, this has ultimately opened doors for many additional institutional players – including Square, MassMutual and Stone Ridge – to play their bitcoin hands, and now it looks like Tesla has joined the ranks. The car company recently purchased as much as $1.5 billion worth of bitcoin, and the currency has been experiencing a hardcore rise ever since. It is now trading for well over $47,000, which is about $5,000 higher than where it was just 24 hours ago.
Many analysts and industry experts believe this move is going to send bitcoin into more mainstream and legitimate territory. They also believe that bitcoin and cryptocurrency could potentially outgrow the $12 trillion market cap of gold. Nick Jones – chief executive of crypto wallet company Zumo – explained in a recent interview:
Tesla’s investment is further validation of bitcoin’s place as a premium asset for corporate, institutional and retail investors, and we should expect to see more large purchases being announced in the coming months.
Alex Kuptsikevich – senior analyst at FX Pro – has also stated that bitcoin is being viewed through an entirely new lens thanks to Tesla, commenting:
Tesla’s $1.5 billion purchase of bitcoin was a trigger for speculators and investors. In recent months, we have seen how quickly bitcoin has gone from market fun to widespread acceptance by the investor community. Now, however, we see an increase in the use of bitcoin by businesses. This could be a new wave of acceptance of bitcoin as a means of payment.
Mitch Steves – a financial analyst – has explained that many large companies, including Apple, are now potentially looking into the possibilities of opening their own crypto exchanges as a means of taking advantage of bitcoin’s newfound profitability. In a recent note to clients, he writes:
The wallet initiative appears to be a clear multi-billion-dollar opportunity for the firm (potential for well over $40 billion in annual revenue with limited R&D).
More Companies Will Get In Bed with BTC
Simon Peter of e-Toro fame has also stated:
Yesterday’s move by Tesla to invest in bitcoin and start accepting it as payment for its own products really moved the needle. Already, there is talk of copycat moves from Apple and Google linking it to their own payment systems.