Tesla has invested $1.5 billion in Bitcoin and plans to accept Bitcoin payments

Tesla has invested $1.5 billion in Bitcoin, according to a filing with the U.S. Securities and Exchange Commission (SEC) today.

"To date, we have invested a total of $1.5 billion in bitcoin as permitted by law and may continue to acquire and hold such digital assets from time to time," the Tesla filing said, adding that Tesla expects to begin accepting bitcoin as payment for its products (cars) in the near future.

As soon as the news came out, the price of Bitcoin soared. As of press time, the price of Bitcoin has risen from $39,000 to $43,000, setting a new all-time high.

The trading expert saw the move as unsurprising, but acknowledged it was a significant development for cryptocurrencies. “People were really just waiting for the moment when Elon Musk announced that one of his companies had allocated part of its reserve assets to Bitcoin,” said Guy Hirsch, managing director of eToro US.

Hirsch also noted that the news of Tesla’s Bitcoin deal came just days after the recent MicroStrategy WorldNow conference aimed at attracting institutional investors to Bitcoin. At the event, MicroStrategy CEO Michael Saylor said he expects “a large number of companies” to convert their balance sheets into Bitcoin. “This is further evidence that smart money is still buying Bitcoin even as many others are reducing their Bitcoin holdings,” Hirsch said.

He added: "Musk and Tesla are driving the market in a way that no one else can, and this may be the point at which we look back and realize that Bitcoin has gone mainstream."

Tesla updated its investment policy in January to diversify its cash on hand and maximize returns, the document said. Its policy said it may invest its reserves in digital assets, gold, gold ETFs and other assets. With this new policy in mind, it has made a large investment in Bitcoin.

MicroStrategy CEO Michael Saylor Recommends Bitcoin to Elon Musk

Tesla bought Bitcoin after MicroStrategy’s Saylor extended an invitation to Elon Musk, showing him his playbook for buying Bitcoin. “If you want to do $100 billion in favors for shareholders, convert TSLA’s balance sheet from USD to #BTC. The rest of the S&P 500 will follow your lead and slowly become $1 trillion in favors,” Saylor tweeted @Musk .

Musk responded by asking, “Is it possible to make such a large transaction?” He likely meant whether it was possible to buy such a large amount of Bitcoin, not in terms of sending a large Bitcoin transaction.

Soon after, Musk began tweeting more about cryptocurrency. On January 29, he changed his Twitter bio to a single word: #Bitcoin. He later confirmed on Clubhouse that he was now a "Bitcoin supporter."

“I’m late to the party, but I’m a Bitcoin supporter,” he told the audience. “Bitcoin is on the verge of being widely accepted by people in the traditional finance world.”

Musk has been tweeting about Dogecoin and has been promoting it, joking that it will be the future currency of the earth. Although the price of Dogecoin has skyrocketed, it seems that his focus and Tesla's money bag are all focused on Bitcoin.