Bitcoin Explodes Above $42,000 After Tesla Buys $1.5 BIllion

In retrospect, it was so obvious.

Back on January 9, when discussing the recent surge of institutional and corporate purchases of bitcoin and conversion of cash into the cryptocurrency, we said that it was just a matter of time before Elon Musk joined MicroStrategy and bought "several billion" in bitcoin. Specifically, in "How Bitcoin Hits $100,000 Next: Morgan Stanley Boosts Stake In Microstrategy, Opening The Floodgates" we said...

One such company which we are convinced will announce it is converting billions of its existing cash into bitcoin, is none other than Tesla, whose CEO Elon Musk was urged by MSTR CEO Saylor to make a similar move with Tesla’s money. And since Musk, already the world's richest man thanks to the most aggressive financial engineering on the planet, has never been one to shy away from a challenge, we are absolutely confident that it is only a matter of time before Tesla announces that it has purchased a few billion bitcoin.

One month later, One River's Eric Peters clearly agreed with our take, and shortly after Elon Musk tweeted his appreciation of bitcoin, said that "It’s possible Elon hasn’t yet bought his bitcoin and pre-announced the intention, lifting the price ahead of his purchases. But sane people don’t do such things."

Well, we were right, and so was Eric Peters just because moments ago, Tesla filed its 10K in which it quietly said that not only had it purchased $1.5BN in bitcoin (not the idiotic dogecoin that Musk had been pushing in his recent tweets) just as we predicted...

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. Moreover, we expect to begin accepting bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis, which we may or may not liquidate upon receipt.

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