Electric automaker Tesla said Monday that it has invested around $1.5 billion in Bitcoin and it plans to begin accepting the digital currency as payment for its high-end vehicles soon. The price of Bitcoin soared 15.4% to around $44,500 Monday in reaction to Tesla’s announcement, according to CoinBase.

The California-based electric car maker headed by Elon Musk revealed the new strategy in a filing with the U.S. Securities and Exchange Commission, saying its investment in digital currency and other “alternative reserve assets” may grow.

Bitcoin has drawn enthusiasts for its scarcity and security, but the volatile digital currency still is not widely used to pay for goods and services. It’s mostly been a store of value, like gold, with some limited merchants like Overstock accepting bitcoin for payment. It’s also used by those distrustful of the banking system or criminals seeking to launder money.

Whether other major companies will follow Tesla’s lead in investing in Bitcoin or accepting it for transactions is unclear. A vehicle is a large purchase, which could make Bitcoin a better fit to pay for it, but the wild price swings in Bitcoin could be a significant risk to any merchant who decided to accept it.

“It was wise of Tesla to announce that it will deem its investment in Bitcoin as an “alternative asset.” That is certainly appropriate because Bitcoin might be coming into greater acceptance as a currency, but it is not cash,” said Anthony Michael Sabino, a professor of law, at St. John’s University.

Tesla is in a unique position to accept digital currencies for payment since the automaker does not rely on a network of independently owned dealerships to sell its vehicles unlike traditional car companies such as General Motors and Ford.

Whether Tesla will get a definitive competitive advantage in accepting Bitcoin remains to be seen. The automaker could be simply investing in Bitcoin because Musk has been known to have eclectic tastes. Musk launched a Tesla car into space to demonstrate the payload capabilities of his SpaceX company rockets.

Also Read:

TESLA NEVADA FACTORY WAS TARGET OF 'SERIOUS' CYBERATTACK

BATTERY PRODUCTION: HOW THE HEART OF AN ELECTRIC CAR IS MADE

FORD MUSTANG EARNS WORLD’S BEST-SELLING SPORTS CAR TITLE | REVIEWS NEPAL

TOP 5 PICKUP TRUCKS IN NEPAL | SPECIFICATIONS AND PRICE IN NEPAL

INDIAN SCIENTISTS DEVELOP BATTERY TECHNOLOGY TO MAKE EVS WITH 1600 KM BATTERY RANGE

KTM BIKES IN NEPAL WITH FULL SPECIFICATION AND PRICE

Tesla's market top hit $100 billion on Wednesday, speeding past Volkswagen, which right now sits at $88 billion. Tesla shares flooded 16% in the week through January 23, expanding Elon Musk's total assets by $1.7 billion to $32 billion.

The 49-year-old Tesla CEO, who possesses almost 22% of the electric vehicle producer's stock, is as of now the 28th-most extravagant individual on the planet. He additionally has an expected $12.5 billion stake in SpaceX, his secretly held aviation organization known for reusable rockets.

Tesla shares have dramatically increased since October and are up over 30% this year — it's still just January. Tesla outperformed Ford and GM in advertise capitalization prior this month. The main carmaker still behind Toyota, with a market top of $233 billion.

Also read  FORD MUSTANG MACH-E: ONLINE RESERVATION STARTING 17 NOV. COMPARE WITH TESLA MODEL Y

                     TOP 10 RICHEST CAR COMPANIES 

 

Tesla's battery supplier says it's made a huge breakthrough in battery technology that could power electric-vehicle sales for years to come.

Contemporary Amperex Technology Ltd., the Chinese car-battery giant that supplies Tesla and Volkswagen, is ready to produce a battery that can last 16 years and 2 million kilometers, or 1.24 million miles, the company's chairman, Zeng Yuqun, told Bloomberg over the weekend.

Zeng said the company was ready to start fulfilling orders for the battery but didn't disclose whether anyone had bought any yet. He added that the battery cost about 10% more than average EV batteries.

Battery life is one of the main areas holding back widespread EV adoption, and a long-lasting battery could be transformative for the industry. Batteries are the most expensive part of EVs, so if one with a longer life could be transferred into a new car, it could significantly lower the price. Bloomberg said warranties on EV batteries cover roughly 150,000 miles or eight years.

Reuters reported in May that Tesla was making a million-mile battery with CATL. Sources told Reuters that Tesla planned to launch the new battery in China first as part of a wider strategy to reposition the company. Tesla did not immediately respond to Business Insider's question about whether the battery announced by CATL was developed jointly.

In his interview with Bloomberg, Zeng seemed upbeat about the industry's prospects, which took a downturn with the coronavirus pandemic. "The pandemic may have a lasting effect throughout 2020," he said, "but won't be a major factor next year."

Also Read:

NISSAN LICENSES LITHIUM-ION BATTERY TECHNOLOGY TO APB CORPORATION

TOYOTA AND PANASONIC ESTABLISH JOINT VENTURE TO MAKE AUTOMOTIVE PRISMATIC BATTERIES

TOYOTA DEVELOPS FUEL CELL SYSTEM FOR MARITIME APPLICATIONS

BYD AND TOYOTA'S JOINT VENTURE TO MAKE BATTERY ELECTRIC VEHICLE