Tesla’s Already Making Bank Off Bitcoin Investment

With its recent investment in bitcoin, Tesla (TSLA) may have already made over $600 million. All thanks to a surge in the cryptocurrency following the announcement of the automakers investment.

Tesla’s move to not only make a huge investment of $1.5 billion into the bitcoin, but also to take the cryptocurrency as a form of payments sent the world of crypto into a frenzy. In its announcement, the automaker stated: “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. As part of the policy, which was duly approved by the Audit Committee of our Board of Directors, we may invest a portion of such cash in certain alternative reserve assets including digital assets, gold bullion, gold exchange-traded funds and other assets as specified in the future. Thereafter, we invested an aggregate $1.50 billion in bitcoin under this policy and may acquire and hold digital assets from time to time or long-term.“

Although a number was not released in regards to how many bitcoins Tesla acquired, or the average purchase price, some simple math gives us a rough estimate. With the price of bitcoin averaging around $35,000 during January, Tesla’s $1.5 billion investment puts around 43,000 bitcoins in the automaker’s pocket.

After Tesla’s investment, we watched the price of bitcoin surge 15% and rise a total of 45% in the last month alone. 

The value of a bitcoin is currently trading at about $52,000 USD, putting Tesla up around $600 million since its investment. If Tesla does have somewhere around 43,000, they are looking at around $2.2 billion, or more, in value if it continues trading at this rate. 

Although the cash is nice, there’s always a Debbie Downer. The automaker is now under scrutiny for its decision to purchase and accept the cryptocurrency while trying to further the adoption of lower-CO2 alternatives to ICE vehicles. 

The reason behind this is because the bitcoin “mining” process can be very energy-intensive, causing some critics to point fingers at Tesla saying the promotion of the cryptocurrency adds to its carbon footprint. 

It seems a little extreme, and recent reports show Bitcoin’s evolution into one of the most eco-friendly cryptocurrencies you can buy. Some studies even showed “around 75% of bitcoin mining was powered by renewable energy sources.” Although bitcoin carries immense money-making potential and incredible benefits, it’s always wise to be aware of your cryptocurrency’s carbon footprint.

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