Tesla has already profited approximately $ 1 billion from its investment in bitcoin (BTC), according to calculations by an analyst at investment firm Wedbush Securities released on Saturday. Interestingly, Elon Musk said this weekend that the price of the digital asset “really looks high”. Meanwhile, the cryptocurrency has depreciated by more than $ 10,000 on Monday.
In early February, Tesla announced that it changed its investment policy and that in January 2021 it bought $ 1.5 billion in bitcoin. Elon Musk’s electric car company did not disclose the amount of BTC acquired or the exact date of the acquisition. However, Daniel Ives, an analyst at Wedbush Securities, calculated the potential profit that the investment could have already yielded, as reported by CNBC.
Analyst estimates Tesla has already profited $ 1 billion
Tesla would be “on track to profit more from its investments in bitcoin than from selling its electric vehicles throughout the year 2020,” estimated the analyst on Saturday.
In a document sent to the United States Securities and Exchange Commission in early February, Tesla stated: “In January 2021, we updated our investment policy to provide us with more flexibility to further diversify and maximize returns on our cash.” Thus, Musk’s company also revealed that it invested $ 1.5 billion worth of bitcoin that month.
That said, Ives estimates that the profit from this investment could have already exceeded US $ 1 billion. We do not know whether Tesla actually sold any amount of the digital asset and the amount purchased in bitcoin was also not revealed. However, we know that the investment took place sometime in January.
The analyst did not explain his calculation, but taking into account the average asset price of $ 35,000 last month compared to Saturday’s $ 57,500 high, when Ives revealed his estimate, the accounts make sense. This is a 65% valuation that applied to the amount invested by Tesla results in a profit of US $ 975 million.
Elon Musk says bitcoin price “looks high”
Tesla’s CEO said something curious on his Twitter this Saturday. In response to a follower, he said the price of bitcoin and ether “really looks high”. One user stated: “According to Elon Musk, bitcoin is almost the same nonsense as a fiat currency… I agree, I just think that bitcoin, which is a digital fiat currency and is even more nonsense than fiat money on paper issued central banks. Gold is not nonsense. It is real money and better than both! ”
In response, Musk said that “money is just a piece of data that allows us to avoid the inconvenience of exchange”. He added by saying that cryptocurrencies, like any data, are subject to latency and errors. “The system will evolve to minimize both … That said, BTC and ETH really look high,” he concluded.
The follower referred to Musk’s speech last Friday (19), when the billionaire defended Tesla’s investment in bitcoin after questions from the CEO of Binance.
“To be clear, I am not an investor, I am an engineer. I don’t even have publicly traded shares other than Tesla. However, when the fiat currency has negative real interest, only a fool would look elsewhere. Bitcoin is almost the same nonsense as a fiat currency. The keyword is ‘almost’, ”said the tycoon.
Bitcoin suffers $ 10,000 devaluation
This Monday, the digital asset operated in a sharp drop. The cryptocurrency reached a new price record on Sunday, reaching $ 58,332, as indicated by the index CoinDesk.
However, over the course of today the crypto has plummeted to a minimum of $ 47,780, resulting in a further $ 10,000 devaluation in just 24 hours. Bitcoin quickly recovered and at the time of this publication operates in the $ 52,000 range.
With information: CNBC, Reuters