Bitcoin shares rose to a new record level on Monday, breaking over $46,000 per share. The rise marked a 20.33% increase in shares, settling at $46,081.64. It was Bitcoin’s best day since last March. Bitcoin’s intraday high was $47,458. The stock gained momentum when it was revealed that Tesla bought enough shares to have a large stake in the cryptocurrency. It wasn’t the only time Bitcoin created a storm of excitement. The digital currency’s stock more than quadrupled last year in 2020.
Tesla also announced that the company would start taking bitcoin payments for its products. It’s the first time a major automaker agreed to accept Bitcoin payments. Dan Ives, a Wedbush analyst, said that Tesla’s ownership of Bitcoin would create a “ripple effect across corporations around the global.” Ives called the move a potential game-changer “from a transactional perspective.”
In a Securities and Exchange Commission filing, Tesla said that it had purchased $1.5 billion in bitcoin shares. Tesla said it made the purchase for “more flexibility to further diversify and maximize returns on our case.”
The electric automaker also said that it would probably invest a portion of its digital assets. As far as its acceptance as bitcoin payments on its electric cars, Tesla said it was “subject to applicable laws and initially on a limited basis.”
The pioneering automaker’s investment is yet one more sign that cryptocurrency may be the future as it sees more acceptance among major investors and corporations. In 2020, Paypal and Square made moves into cryptocurrency. More recently, Stanley Druckenmiller and Paul Tudor Jones have elevated bitcoin, a move not seen before with investors. It’s now believed institutional investors may use bitcoin to replace gold as a safe haven.
By midday Wednesday, Bitcoin shares stood at 44,677.67.