Tesla invests about $1.5 billion in bitcoin, plans to accept it as payment mode

Electric car maker Tesla has acquired $1.5 billion worth of bitcoin and plans to begin accepting it as a form of payments for its products in the near future, the company disclosed in a filing with the U.S. Securities and Exchange Commission (SEC).

This move comes a week after Tesla chief executive Elon Musk said bitcoin was "on the verge" of being more widely accepted among investors, expressing support for the cryptocurrency. Musk has often tweeted his support for cryptocurrency and had recently added "#bitcoin" to his Twitter bio for few weeks, which pushed the Bitcoin price by 14%.

Tesla said in the filing this move was part of its updated investment policy to provide them more flexibility with diversify and maximize its returns on cash that is not required to maintain adequate operating liquidity.


"As part of the policy, which was duly approved by the Audit Committee of our Board of Directors, we may invest a portion of such cash in certain alternative reserve assets including digital assets, gold bullion, gold exchange-traded funds and other assets as specified in the future" the company said in a filing.

Tesla noted it plans to initially accept bitcoin as a form of payment for its products on a limited basis, subject to applicable laws.

Bitcoin prices jumped as much as 15% to a record high of $44,000, following this announcement.

"He's now putting his money (shareholders') where his mouth is," Markets.com analyst Neil Wilson told Reuters "But given his recent comments – and adding #Bitcoin to his Twitter bio on January 29th – it also raises a real question about possible market manipulation."