Bitcoin jumped 10 percent on Monday following Tesla's disclosure.
By Reuters | Updated: 10 February 2021 17:46 IST
In chat on Clubhouse , Musk said Bitcoin was "on the verge" of being more widely accepted
Tesla said it would soon accept Bitcoin as a form of payment
Last month, Musk added "#Bitcoin" to his Twitter profile
The price of Bitcoin has quadrupled since in the past four months
Tesla's $1.5 billion (roughly Rs.10,920 crores) Bitcoin investment unveiled on Monday may not surprise CEO Elon Musk's followers on Twitter, where he has shown himself as a major proponent of the soaring cryptocurrency.
The announcement of Tesla's investment, buried in Tesla's 2020 annual report, follows months of tweets by Musk related to cryptocurrencies including Bitcoin BTC=BTSP, sometimes helping fuel its rally.
The cryptocurrency jumped 10 percent on Monday following Tesla's disclosure.
In a December exchange on Twitter, Musk asked MicroStrategy CEO Michael Saylor, who recommended Tesla buy Bitcoin, about the possibility of "large transactions" to convert some of Tesla's balance sheet to the cryptocurrency.
Saylor is a Bitcoin bull and his software company has bought around 71,000 Bitcoins, currently worth close to $3 billion (roughly Rs. 21,900 crores). MicroStrategy's stock jumped 18 percent on Monday, bringing its gain in 2021 to 146 percent as traders view it as a play on Bitcoin.
Replying in May to a tweet by author J.K. Rowling about Bitcoin, Musk wrote that massive debt taken on by central banks made Bitcoin more attractive. He added that he owned only a quarter of a bitcoin, which was trading below $10,000 (roughly Rs. 7.2 lakhs) at the time.
Driven in part by interest from institutional investors, the price of Bitcoin has quadrupled since in the past four months, surging far beyond record highs set in 2017. Some investors view it a hedge against inflation.