Tesla sold bitcoin to prove liquidity as cash alternative: Elon Musk
Bitcoin: Elon Musk said Tesla Inc. sold 10% of its Bitcoin holdings to demonstrate the token’s liquidity. While adding that he’s retaining his personal investment in the cryptocurrency.
Moreover, Tesla’s earnings report showed the firm, which bought more than $1 billion of the tokens earlier this year generated $101 million in income from the sale. Musk said on Twitter that Tesla in essence was trying “to prove liquidity of Bitcoin as an alternative to holding cash on the balance sheet.”
On the other side, the electric vehicle maker forced cryptocurrencies onto the agenda of corporate treasurers. Worldwide with its investment in Bitcoin. While many continue to view the token as just too risky to be compared with cash. Tesla’s Chief Financial Officer Zachary kirkhorn said on an earnings call that the company believes in Bitcoin’s long-term value.
No, you do not. I have not sold any of my Bitcoin. Tesla sold 10% of its holdings essentially to prove liquidity of Bitcoin as an alternative to holding cash on balance sheet.
— Elon Musk (@elonmusk) April 26, 2021
He was responding to a separate tweet from Barstool Sports president Dave Portnoy. Who claimed that Musk bought Bitcoin, pumped it, and then dumped it to make a fortune.
Bitcoin and other tokens are purely speculative investments rather than legitimate alternatives to cash. For instance, BCA Research Inc. argues that fails as a store of value. Unit of an account owing to its volatility, even though these are basic functions of money.
However, Musk has been a high-profile supporter of cryptocurrencies for some time. And late last month announced that Tesla would begin accepting payments for its vehicles in Bitcoin.
The world’s largest cryptocurrency climbed about 1% to $53,765 in Tokyo on Tuesday. It’s tumbled from a peak of almost $64,870 in mid-April but is still up sevenfold in the past year. Tesla fell as much as 3.1% in late trading after its results were announced Monday despite record profit in the first quarter.
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