Tesla (NASDAQ:TSLA) announced it will begin accepting bitcoin as a form of payment for otheir products in the near future.
The EV company declared they updated their investment policy in January 2021,to provide the company with “more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity.” Bitcoin investors agreed: Prices rose more than 10% on the news Wednesday.
“As part of the policy, we may invest a portion of such cash in certain specified alternative reserve assets. Thereafter, we invested an aggregate $1.50 billion in bitcoin under this policy. Moreover, we expect to begin accepting bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis, which we may or may not liquidate upon receipt.”-it is said in the SEC filing signed by Elon Musk.
“We believe our bitcoin holdings are highly liquid. However, digital assets may be subject to volatile market prices, which may be unfavorable at the time when we want or need to liquidate them.”- Tesla stated adding that “
Tesla ended 2020 with $19.38 billion in cash and cash equivalents, representing an increase of $13.12 billion from the end of 2019. Their cash flows from operating activities during 2020 was $5.94 billion, compared to $2.41 billion during 2019, and capital expenditures amounted to $3.16 billion during 2020, compared to $1.33 billion during 2019. Sustained growth has allowed our business to generally fund itself, it is stated in the filing.
Tesla (TSLA) stock is up 3% during pre-market session on Monday.