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Dec 2020 - Raises $5bn from investors Jan 2021 - Spends 30% of raised money to buy Bitcoin What value are Tesla adding here? Those investors could have just p
by nly 6y ago
Dec 2020 - Raises $5bn from investors
Jan 2021 - Spends 30% of raised money to buy Bitcoin
What value are Tesla adding here? Those investors could have just put 70% in to Tesla and 30% in to Bitcoin directly.
Arguably, the only positive here (for BTC and TSLA holders) is short term, and it's that Tesla are associating their brand with Bitcoin to whip up froth.
- RhodoGSA 6y agoMichael Saylor raised $900m in debt to buy bitcoin. It's like a free option call on bitcoin and is rather ingenious. If bitcoin spikes, you convert you debt into stock. If bitcoin falls, you still got your debt.
- jackTheMan 6y agoor it is a hedge against a market downturn as gold is "not cool" to buy from Tesla and cash should be invested if not used.
- mskec 6y agoBitcoin dropped 55% in March 2020 vs S&P500 dropping 35%. You'd lose more with this hedge than without.
- jackTheMan 6y agoTesla dropped even more (180->72) and since then it is hyped even more even so it still doesn't make profit from it's core business. And since then lot of people hyped the bitcoin.
- Tenoke 6y ago1. It helps to have significant holdings if you plan to use the currency. 2. Tesla buying btc might conceivably move the price more and result in higher overall profits than the investors holding it directly. 3. A lot of companies make investments that in theory the shareholders could've done on their own.