HomeTech PlusTECH & OTHER NEWSTesla's $1.5 billion bitcoin purchase points to crytocurrency as tech company reserve...

Tesla’s $1.5 billion bitcoin purchase points to crytocurrency as tech company reserve currency

Tesla’s move to invest $1.5 billion in bitcoin further solidifies cryptocurrency as an emerging reserve currency for technology companies.

In a regulatory filing, Tesla said that it invested $1.5 billion in bitcoin to diversify its balance sheet away from cash and maximize returns. While Tesla is the biggest tech company to wade into the cryptocurrency pool it isn’t the first.

MicroStrategy, an analytics software company, invested $1 billion in bitcoin in 2020. MicroStrategy has essentially put its cash holdings in bitcoin. In December, MicroStrategy said that it purchased 29,646 bitcoins for approximately $650 million at an average price of approximately $21,925 per bitcoin including expenses.

The company held 70,470 bitcoin acquired for $1.125 billion and an average price of $15,964. Bitcoin in early trading was $43,840. MicroStrategy as of Dec. 31, 2020 had $59.7 million in cash and cash equivalents, down from $565.5 million in 2019, as the company is using digital assets to fortify its balance sheet.

Meanwhile, Square said in its third quarter shareholder letter that it will begin investing in bitcoin as a long-term holding. PayPal is developing a cryptocurrency product roadmap. 

In addition, Overstock was among the forerunners in seeing the value of blockchain technology as well as cryptocurrency. Aside from its retail business, Overstock includes tZero, a cryptocurrency marketplace, and Medici Ventures, a unit focused on blockchain technology.

By ZDNet Source Link

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