Tesla (NYSE: TSLA) has announced that it will start accepting Bitcoin as payment for its vehicles in the future. The news comes after the electric car manufacturer’s annual SEC filing revealed a new $1.5 billion investment in the cryptocurrency.
“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,” Tesla said in the filing. “As part of the policy, we may invest a portion of such cash in certain specified alternative reserve assets. Thereafter, we invested an aggregate $1.50 billion in bitcoin under this policy.”
The company also said that it expects to begin accept Bitcoin as payment “subject to applicable laws and initially on a limited basis,” which would make them the first automobile company to do so.
News of Tesla’s new investment helped push Bitcoin’s value up on Monday morning, reaching as high as $47,241; the cryptocurrency hit a value of $41,940 last month, making that the highest it’s ever been until today. Tesla shares also rose by two percent to $867.87 by mid-day.
Elon Musk Possibly Dropped Some Hints
It’s possible that the public may have received hints about Tesla buying into Bitcoin prior to its announcement.
Two weeks ago, Tesla CEO Elon Musk added the cryptocurrency’s name to his Twitter bio, as well as the hashtag #bitcoin. The move boosted Bitcoin’s value by up to 20 percent for a brief period. He also sent out a tweet with the cryptic message, “In retrospect, it was inevitable.”
Days later, Musk confirmed that he was a firm supporter of Bitcoin during a discussion on the popular Clubhouse app.
“I’ve got to watch what I say here because some of these things can really move the market. Many friends of mine have tried to convince me to get involved in bitcoin for a long time,” Musk said. “I do at this point think bitcoin is a good thing, and I am a supporter of bitcoin.”
Additionally, Musk spoke on his brief that Bitcoin is “really on the verge of getting broad acceptance by conventional finance people,” and how he is “late to the party.”
The Tesla-Bitcoin news also comes after the company revealed a new redesign of its Model S sedan, the first since its release in 2012. The redesign, launching in March, includes a new interior, revamped exterior and a new powertrain that allows the car to drive up to 520 miles. In addition, there will be a small update to its Model X SUV, with interior and exterior touch-ups and a version with the new 520-mile range.