Sam Bourgi
Tesla (TSLA) sent shockwaves across the financial markets Monday after a United States Securities and Exchange Commission filing confirmed that the electric vehicle maker has added Bitcoin (BTC) to its balance sheet.
Tesla’s latest Form 10-K filing for the fiscal year ended Dec. 31, 2020 shows a $1.5 billion allocation to Bitcoin. As Bitwise researcher David Lawant points out, Tesla’s BItcoin exposure represents roughly 7.7% of its gross cash position.
Jack Martin
Service outages have been reported at major cryptocurrency exchanges on Feb. 8, following the news that Tesla invested $1.5 billion in Bitcoin. As Cointelegraph reported earlier, news of Tesla's sizeable investment broke after the discovery of a filing with the U.S. Securities and Exchange Commission. This caused Bitcoin price to jump $3,000 in a matter of minutes, eventually claiming a newall-time high of $44,850.
Problems were reported at a number of exchanges, including Binance, whose CEO CZ tweeted that a traffic influx was causing temporary delays while auto-scaling caught up, and that Tesla CEO Elon Musk was to blame.
Many Kraken users took to Twitter to complain that the site was also down, although there was no official confirmation of this from the exchange itself.
Despite assurances from the exchanges that past issues have been addressed, platforms continue to crash on a regular basis during high-traffic periods such as price pumps; the time when most investors want their service to be at its most stable.
Andrey Shevchenko
In Monday’s filing with the Securities and Exchange Commission, the company announced it had purchased an aggregate of $1.5 billion in Bitcoin, to be held as an investment and store of value for its excess cash. It is currently unknown what is the average purchase price and number of BTC the company acquired. Tesla's investment policy has been updated at an unspecified point in January 2021, which suggests that Tesla may be holding between 35,900 and about 45,500 BTC, corresponding to average prices of $42,000 and $33,000, respectively. Given Bitcoin's price movement in the last few weeks, the 45,500 BTC estimate is likely closer to the true amount.
As part of the policy, Tesla expects to begin offering clients the ability to purchase its products in Bitcoin, the filing states. Unlike many other similar initiatives, the Bitcoin it receives will not necessarily be liquidated as soon as possible, thus possibly adding to its reserves.
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