Tesla announced in an SEC filing this morning that it will begin accepting Bitcoin as a form of payment "in the near future." The California-based automaker further said it bought $1.5 billion in the digital cryptocurrency. According to Bloomberg, that sent the currency to a record price of $43,000.
According to the filing, Tesla's new policy was adopted to "provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity." After that decision received the blessing of Tesla's Board of Directors, the automaker made the massive investment in Bitcoin, adding that it "may acquire and hold digital assets from time to time or long-term."
This being an SEC filing, Tesla summarized the dangers of investing in the digital currency like Bitcoin, calling them "highly volatile." In other words, the price of Bitcoin could fluctuate in the future and potentially fall below the price Tesla paid for it, which could lead to the automaker losing money on the transaction when it's time to sell the Bitcoin.
Dogecoin is the people’s crypto — Elon Musk (@elonmusk) February 4, 2021
Recent tweets from Tesla chief Elon Musk may have telegraphed the automaker's interest in cryptocurrency. After adding the word Bitcoin to his Twitter bio (and then deleting in shortly thereafter), he tweeted that "Dogecoin is the people's crypto." That tweet was credited with sending the price of Dogecoin soaring, as well.