Electric vehicle manufacturer, Tesla invested $1.5 billion in the popular cryptocurrency, Bitcoin. Tesla had disclosed in a regulatory filing regarding its investment in Bitcoin. Prices of Bitcoin jumped by almost 15%, rising to $44,000 for the first time. Bitcoin prices had crossed the $20,000 hurdle late last year, and have not wasted any time in racing past the $44,000 mark.
Bitcoin’s meteoric rise
Bitcoin, just 12 years old, has managed to multiply investor wealth several fold. With giants such as PayPal, Square Inc., MicroStrategy Inc, along with several other financial institutions backing Bitcoin, the rise in prices has been nothing but phenomenal. The price movement of Bitcoin has been highly volatile, however the price trend in generally has been nothing but upwards.
Tesla has said that it would be accepting Bitcoin as a mode of payment for its electric vehicles. The backing of a heavyweight is expected to massively benefit Bitcoin, and could send its prices soaring. This has brought it one step closer to being accepted as a major currency. Though Bitcoin remains expensive in fiat currency terms, due to its limited supply, the demand could drive its prices further upwards. Analysts expect Bitcoin prices to cross $50,000 in the very near future. However, it would be some time before it could be accepted as a mainstream currency. The Indian government too has mulled imposing a tax on trading of Bitcoin. Imposing a tax on cryptocurrency would really help to bring it into the mainstream.
Elon Musk’s fascination with cryptos
The world’s richest man and Tesla’s CEO, Elon Musk has always been fascinated with cryptocurrencies. Last week, Musk had tweeted about Dogecoin, another crypto currency, and had sent its price soaring.
Last week, Elon Musk had included “Bitcoin” to his twitter bio and this sent the price soaring by more than 15% making it cross $35,000 for the first time.