Elon Musk’s electric car company is ready to be more of it Bitcoin investment made in January than of all its car sales in all of 2020, it said a message from the American research firm Wedbush Securities.
Tesla announced earlier this month that it had purchased $ 1.5 billion worth of it Bitcoin in January. After Tesla’s announcement, Bitcoin’s price skyrocketed like one of the rockets from Musk’s other venture, SpaceX. Shortly after the news was released, the price of Bitcoin jumped by 8.5%.
And Bitcoin has continued to rise: 12 days later, Bitcoin has broken $ 57,000 and hit a market cap just north of $ 1 trillion.
Wedbush analysts Dan Ives and Strecker Backe estimate Tesla has already made $ 1 billion in profits from its Bitcoin investment; compare that to the $ 721 million in profit Tesla reported for fiscal year 2020. (This assumes Tesla hasn’t sold any bitcoin it bought in January.)
Musk helped the price of Bitcoin by tweeting about it to his 47.5 million followers. When he changed his Twitter bio to “# Bitcoin #”, the price of Bitcoin rose 13% within an hour. Musk has also defended the coin against critics. When gold bug and Bitcoin critic Peter Schiff, who heads Euro Pacific Bank, tweeted that gold was superior to crypto, Musk disagreed, tweeting“An email saying you have gold is not the same as having gold. You might as well have crypto.”
Wedbush calls the Bitcoin investment a “side show for Tesla,” but also thinks it could have a “ripple impact” for public companies over the next year and a half.
Still, the company predicts that less than 5% of publicly traded companies will copy Tesla’s Bitcoin investment ‘until more regulatory target posts are set around the crypto market.”
Wedbush remains optimistic that crypto “will have a seismic impact on blockchain, payments, banks and semis in the coming years. ”
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