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08 Feb 2021 | 13:19

Bitcoin surges as Elon Musk's Tesla buys $1.5bn worth

(Sharecast News) - Bitcoin surged on Monday after it emerged that Elon Musk's Tesla has invested heavily in the cryptocurrency. In a Securities and Exchange Commission filing, the electric car maker disclosed that it has bought $1.5bn worth of Bitcoin and that it plans to begin accepting it as a form of payment for its products "in the near future".

Bitcoin rallied 13% on the news to hit a new record high of $43,774.

Tesla said it bought the cryptocurrency to provide the company "with more flexibility to further diversify and maximise returns on our cash that is not required to maintain adequate operating liquidity".

Neil Wilson, chief market analyst at, said: "This is the kind of backing that can take Bitcoin through $50k.

"Once again it highlights the power that Elon Musk has in shaping price action and moving markets. He's now putting his money (shareholders') where his mouth is. But given his recent comments - and adding #Bitcoin to his Twitter bio on January 29th - it also raises a real question about possible market manipulation.

"Musk's tweeting record is chequered to say the least ('funding secured') and he has had his knuckles rapped by the SEC in the past. The filing simply says that the investment policy was updated in January 2021 and 'thereafter' the company invested an aggregate $1.5bn in Bitcoin. Timing would appear critical.

"Tesla also says it may acquire and hold other digital assets. The move will also raise questions for fund managers who may not want to invest in a company with this kind of risk on its balance sheet - we know Bitcoin is very volatile - this is normal FX risk x100. Tesla is now starting to take on big FX risk - this may not worry a lot of investors, but some conservative types might be concerned."

At the end of last month, Musk sent Bitcoin flying after changing his Twitter bio to just "#bitcoin".
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