Tesla Bitcoin Investment: Reason and Purchase Date Revealed

Bittime - Tesla recently provided a more detailed explanation regarding its move to purchase $1.5 billion worth of bitcoin in early 2021. This purchase, announced on February 8, 2021, has taken the cryptocurrency world by storm and attracted widespread attention.

Date Tesla Purchased Bitcoin

Tesla announced their bitcoin purchase on February 8, 2021. This move is part of the company's strategy to look for new ways to store and manage cash that is not used directly. In the first quarter 2021 earnings call, Tesla CFO, Zach Kirkhorn, explained more about this decision.

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Reasons Tesla Invests in Bitcoin

In his explanation, Kirkhorn stated that Elon Musk and he were looking for a way to store cash that was not being used with the aim of getting a decent return while still maintaining liquidity. "Elon and I were looking for a place to store cash that wasn't being used, trying to get some level of return, but also maintain liquidity," Kirkhorn said.

Elon Musk's Increased Interest in Bitcoin

Elon Musk's interest in bitcoin has been visible since 2019 when he called the structure of this cryptocurrency "absolutely brilliant". However, he also admitted that bitcoin is very energy intensive and he was unsure whether it would be a good use of Tesla's resources to get involved in the cryptocurrency at that time. This view changed in 2021 when Musk began to show greater support for bitcoin.

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Liquidity Benefits from Tesla's Bitcoin Purchase

Tesla's purchase of bitcoin was largely driven by the need to maintain liquidity. Kirkhorn explained that "being able to access our cash very quickly is very important to us right now." This becomes especially relevant considering Tesla's massive expansion plans, including the opening of new factories in Texas and Berlin as well as the production of new vehicles such as the Semi and Cybertruck.

Tesla Supports Payments with Bitcoin

Apart from investing in bitcoin, Tesla has also started accepting bitcoin as a payment method for their cars since March 24, 2021. Elon Musk announced this via Twitter, indicating the company's full support for the use of cryptocurrency in daily transactions.

Energy Challenges in Bitcoin Mining

Although this investment brings many financial benefits, the energy usage in bitcoin mining remains a concern. The energy-intensive mining process forces many computers to solve complex problems to earn bitcoins in return. This has led to a debate regarding the environmental impact of bitcoin mining.

Tesla's Future Outlook On Cryptocurrencies

Despite the challenges, Tesla remains optimistic about the future of bitcoin and other cryptocurrencies. Elon Musk, who also owns bitcoin personally, expressed interest in the cryptocurrency's potential in encouraging the use of renewable energy. Musk has even engaged in public discussions regarding how bitcoin can contribute to cleaner energy.

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