Tesla made more on $1.5bn bitcoin buy than 2020 car sales

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If you’re struggling to understand why MicroStrategy would make such a move, you need only look at the success other institutions are having so far. According to US research firm Wedbush Securities, Elon Musk’s electric car company is set to profit more from the Bitcoin investment it made in January than from all of its car sales in the entirety of 2020.

 

Earlier this month, Tesla disclosed it had bought $1.5bn worth of bitcoin in January. The BTC price subsequently jumped by 8.5% in less than two hours.

 

Wedbush analysts Dave Ives and Strecker Backe estimate Tesla has already seen a $1bn profit from its Bitcoin investment, compared to the $721 million in profit it reported for its fiscal year in 2020 – we’d call that a pretty decent investment. This estimate is based on the assumption Tesla hasn’t sold any of the bitcoin it bought in January.

 

Wedbush called the bitcoin investment a “side show for Tesla” but believes it could “have a ripple impact” for public companies over the next year and a half. It added that it believes crypto “will have a seismic impact for blockchain, payments, banks, and semis in the years to come.”

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On our way to the moon, we write about all things crypto. And don’t forget we’re humans too. Our blog conveys the views of Luno and the many unique opinions and characters within our team. We’ll never provide you with financial advice, and we urge you to conduct your own research before purchasing or trading any cryptocurrencies. It’s a brave new world out there, and the market can be volatile at times, so never trade with funds you can’t afford to lose. Want to let us know how much you love our blog? Tweet us @LunoGlobal.

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