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Elon Musk’s Tesla buys $1.5 billion worth of Bitcoin, currency shoots up in value

Tesla announced Monday it has bought $1.5 billion worth of bitcoin.

In a filing with the Securities and Exchange Commission, the company said it bought the bitcoin for “more flexibility to further diversify and maximize returns on our cash.” Tesla also said it will start accepting payments in bitcoin in exchange for its products “subject to applicable laws and initially on a limited basis.” That would make Tesla the first major automaker to accept do so. (The $1.5 billion worth of bitcoin will give Tesla liquidity in the cryptocurrency once it starts accepting it for payments.)

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Tesla’s move into bitcoin represents an investment of a significant percentage of its cash in the investment. The company had more than $19 billion in cash and cash equivalents on hand at the end of 2020, according to its most recent filing.

Bitcoin prices surged to new highs Monday following Tesla’s announcement, reaching a price of at least $44,200. Tesla shares were up more than 2% Monday morning. Tesla warned investors of the volatility of bitcoin’s price in its SEC filing.

Culled from: CNBC

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