Much has been done about the sheer amount that Tesla Inc. has. invested it in bitcoin, a speculative asset that has only existed since 2009.
Read: Why did Tesla buy bitcoin?
However, early estimates by prominent technology analyst Dan Ives show that the electric vehicle maker’s investment, led by sincere CEO Elon Musk, has already hit a digital paper profit of at least $ 1 billion as asset prices rise. pick up records.
“Based on our calculations, we estimate that Tesla has made a profit of about $ 1 billion in the last month … To put this in perspective, Tesla is on a trajectory to make more of its Bitcoin investments than the profits from the sale [electric vehicle] cars throughout 2020 “, wrote the prolific Wedbush analyst Dan Ives, in a note published on Saturday afternoon.
Earlier this month, Tesla Inc. TSLA,
has become the most recent and well-known major corporation that has taken a stake in bitcoin, underscoring the growing acceptability of crypto. The company, based in Palo Alto, California, on February 8, in a public file, said it bought $ 1.5 billion bitcoin BTCUSD,
and that it expects to begin accepting payment in cryptocurrency for its products in the future.
Tesla’s move to invest in bitcoin was seen as further confirmation of the legitimacy of the birth asset that did not exist until about 12 years ago.
On Friday, the price of bitcoin rose to a record about $ 54,000 and violated a total market valuation of $ 1 trillion, further strengthening the perception of crypto as a legitimate asset, if not a nascent one.
Check it out: Is Bitcoin heading for $ 100,000 in 2021 or is its price “unsustainable”?
On Saturday, a single bitcoin extended its gain to a record $ 57,492, according to CoinDesk. Bitcoin prices have risen by more than 90% so far in 2021, according to FactSet data. By comparison, GC00 gold,
considered a rival to bitcoin, fell by about 6% in 2021. Meanwhile, the Dow Jones Industrial Average DJIA,
has so far gained almost 3% this year, the S&P 500 SPX index,
rose by about 4%, and the Nasdaq COMP composite index,
advanced by 7.7% in the same period.
By the way, Tesla’s stock has grown by more than 11% since the beginning of the year.
Wedbush analysts said it’s unclear whether Tesla’s bitcoin move is a stunt, aligned with Musk’s perception as an iconoclast, but still believes other corporations are likely to be forced to follow suit and change some of their cash. for bitcoins in the future.
“We still expect that less than 5% of public companies will follow this path until more regulatory targets are set up around the cryptographic market, which is clearly starting to get more widespread adoption in 2021, and we believe that it will have a seismic impact for blockchain, payments, banks and semi-markets in the coming years “, wrote Ives.