Tesla’s $1.5 billion investment in cryptocurrency did not just make noise on social media, it also gave the company more profit than the money it made building and selling cars last year, Business Insider reported, citing the Times of London report.
Early projections from noted tech analyst Dan Ives sees the investment by Tesla, led by its big boss Elon Musk, already raking in at least $1 billion, as bitcoin’s price continues to register new highs.
“Tesla is on a trajectory to make more from its investments in bitcoin than profits from selling electric cars in all of 2020,” Ives, the Wedbush strategist, was quoted by MarketWatch as saying in a Saturday note.
The Palo Alto, Calif-based electric vehicle maker, wrapped up 2020 with almost $20 billion in cash and cash equivalents, based on a SEC document. Tesla also said it might soon accept bitcoin for its car purchases.
On Friday, bitcoin broke past the $55,000 mark, bringing the crypto’s market value above $1 trillion.
This means if Tesla has the same amount of bitcoin as it did on January 31, the company made a profit of around $930 million since that month. The figure is nearly 30% bigger compared to the $720 million sales it earned from EVs, Insider said.
Meanwhile, the outspoken Musk, whose Twitter comments about the meme-based cryptocurrency dogecoin helped carry the asset to the $10 billion market cap, has warned the price of bitcoin and ethereum “seem high.” This, after he said, “Bitcoin is almost as b.s. as fiat money.“
Replying to gold investor and bitcoin cynic Peter Schiff, Musk said, as quoted by Forbes that “money is just data that allows us to avoid the inconvenience of barter… like all data that is subject to latency and error. That said, bitcoin and ethereum do seem high.”
Image courtesy of Future Lab/YouTube
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