The electric vehicle manufacturer owned by Elon Musk is reportedly becoming the first major automaker to accept bitcoin as currency for payment.
According to CNBC, Tesla has purchased $1.5 billion USD worth of bitcoin. The investment is an effort to gain liquidity in the cryptocurrency so it can begin accepting bitcoin as payment for its autos.
In a Securities and Exchange Commission (SEC) filing, Tesla said it will begin accepting bitcoin payments from customers “subject to applicable laws and initially on a limited basis.” Tesla reported roughly $19 billion in cash holdings as of Dec. 31, 2020, meaning it is investing about 8% of its available cash into bitcoin.
Both Tesla’s share value and the price of bitcoin rose on Monday, Feb. 8, following the company’s announcement. Musk, who previously settled fraud charges with the SEC over tweets he made regarding Tesla possibly going private, has been recently making pro-bitcoin posts on social media. Tesla issued a warning about bitcoin price volatility in its SEC filing.