Elon Musk’s decision to include Bitcoins in Tesla’s balance sheet
To what extent does the entry of large companies into the crypto market affect the growth of cryptocurrencies?
Bitcoin cryptocurrency continues to grow. Over the past week alone, the value of the digital currency has risen from below $20,000 for one Bitcoin to about $24,000 for one Bitcoin, an increase of about 20 percent.
Whether it is about inflating a bubble that will sooner or later burst or about the real growth of cryptocurrency, there are different opinions.
The fact that cryptocurrencies are increasingly appearing in large companies as a means of payment supports the fact that these are real investments.
Also, if we keep in mind that many companies are broadcasting or are preparing to broadcast their cryptocurrencies, as Facebook works on the crypto currency Libra, it also shows that these are real investments. Certainly there are speculative transactions and they contribute to the growth of the value of cryptocurrencies, but not to the extent that is assumed.
Tesla is an American company for electric vehicles and clean energy based in Palo Alto, California. It is named after the celebrated great scientist Nikola Tesla and primarily produces electric cars, advanced batteries for energy storage, solar panels and similar products and services.
Through its actions, it greatly contributes to the preservation of the environment by using renewable energy sources and preventing the ecological catastrophe to which humanity is rushing.
The company was founded in 2003 as “Tesla Motors”, while later it changed its name only to “Tesla”. The chairman of the board is Elon Musk, who personally invested about $6.5 million in the company. This year, 2020, the factory has exceeded the limit of one million electric cars produced, which is a great success. It is obvious that this is a serious world-class company.
Elon Musk recently stated that it will include Bitcoin in the company’s balance sheet, as a special item. If we keep in mind the fact that Elon Musk is an entrepreneur whose assets are measured in billions of US dollars and that he is one of the richest people in the world, the very idea of converting US dollars into Bitcoin caused a storm in the crypto market.
In addition to the company “Tesla”, Elon Musk is also the executive director of the company “SpaceX”, which gives additional weight to the mentioned decision to calculate and present a part of the company’s balance sheet in cryptocurrency. An important role in initiating the described activities was played by Michael Sailor, the executive director of the company “MicroStrategy”, who bought Bitcon in the crypto market for his company worth one billion US dollars.
As the price of Bitcoin has risen by 235 percent this year, it is becoming clear that companies are investing in cryptocurrencies to increase their own value.
Michael Sailor’s $500 million investment has doubled in the last few months and in addition, by selling the company’s bonds, he raised an additional $600 million to buy the next amount of Bitcoin. Due to all the described events, further growth of Bitcoin is expected in the next year.
The entry of large companies into the cryptocurrency market further strengthens the position of the crypto market because it testifies to the fact that real investments are made in cryptocurrencies and that their growth is not exclusively the result of speculative transactions.
Cryptocurrencies are there, and no one can deny their existence and growing influence. We will find out in the near future what the future will bring to us in the financial system.