Tesla made $1B profit on its Bitcoin buy, says analyst

Tesla made $1B profit on its Bitcoin buy, says analyst

Tesla is about to make more money from its Bitcoin investments than profits from selling its electric vehicle cars in all of 2020, an analyst at Wedbush Securities said.

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American electric car giant Tesla has seen some massive gains from its Bitcoin (BTC) investment, reportedly having made up to $1 billion in profit, according to a new report.

An analyst at Wedbush Securities, a private investment firm in the United States, has calculated that Tesla has made “roughly $1 billion” in the aftermath of its $1.5 billion Bitcoin investment. Daniel Ives estimated Tesla’s Bitcoin profits in an investor note on Saturday, CNBC reports.

Amid Bitcoin’s parabolic surge to become a $1 trillion asset, Ives said, “Tesla is on a trajectory to make more from its Bitcoin investments than profits from selling its electric vehicle cars in all of 2020.” 

Ives noted that Tesla’s move is likely to affect other public companies. „While the Bitcoin investment is a side show for Tesla, it’s clearly been a good initial investment and a trend we expect could have a ripple impact for other public companies over the next 12 to 18 months,“ he wrote. However, Ives expects just a small part of the market to follow the trend due to regulatory uncertainty issues:

“We still expect less than 5% of public companies will head down this route until more regulatory goal posts are put in place around the crypto market, which is clearly starting to gain more mainstream adoption in 2021.”

Tesla officially announced its $1.5 billion Bitcoin investment as part of its filing with the U.S. Securities and Exchange Commission on Feb. 8. It still remains unclear how much Bitcoin Tesla bought and at what price, as the company did not disclose this information in the filing.

As Bitcoin traded between roughly $29,000 and $37,000 in the month of January, a $1.5 billion investment could mean Tesla holds anywhere between 40,000 and 51,000 BTC. At the time of writing, Bitcoin is trading at $56,239, up around 15% over the past seven days, according to data from the Cointelegraph Bitcoin price index.

In late January, Tesla reported its first full-year profit, stating that the company earned $721 million in 2020 after an $862 million loss in 2019.


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Tesla is about to make more money from its Bitcoin investments than profits from selling its electric vehicle cars in all of 2020, an analyst at Wedbush Securities said.

Bitcoin ETF approval more likely under new SEC leadership, says Ark Invest CEO

Bitcoin ETF approval more likely under new SEC leadership, says Ark Invest CEO

„I think the probability of an ETF has gone up,“ said Cathie Wood

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Ark Investment Management founder and CEO Cathie Wood said the likelihood that U.S. regulators will approve a Bitcoin exchange-traded fund has gone up under the Biden administration.

In an interview with CNBC’s Bob Pisani today, Wood said there were two signs that the Securities and Exchange Commission might be more open to greenlighting a Bitcoin (BTC) exchange-traded fund, or ETF. Under previous administrations, the regulatory body did not approve any Bitcoin ETFs, to the industry’s chagrin.

Specifically, the Ark Invest CEO said she was encouraged by Joe Biden’s pick for SEC chair, Gary Gensler. Gensler is known as someone who understands the underlying technology of digital assets and BTC itself. In addition, Wood saw FinHub leader Valerie Szczepanik, known as the „Crypto Czar,“  reporting directly to the next chair as a bullish sign.

„I think the probability of an ETF has gone up,“ said Wood. “[Gensler] understands the technology, and I think he understands the currency itself. […] I think we have individuals now involved who really understand the space.“

Wood recognized that institutional interest in the crypto space has surged recently but said she did not expect it to be driven by „broad-based substitution of Bitcoin for cash on corporate balance sheets.“ She said this widescale investment may happen slowly as the market matures, but she was encouraged by the examples already set by Square and Tesla. The payment company added 4,709 BTC to its balance sheet in October 2020, while the car manufacturer announced a $1.5-billion Bitcoin purchase earlier this month.

„If all corporations in the United States were to put 10% of their cash into Bitcoin, that alone would add $200,000 to the Bitcoin price,“ she said.

Perhaps recognizing the potential opportunity in the new regulatory environment, some firms have already applied for a Bitcoin ETF with the SEC following Biden’s inauguration. Yesterday, New York Digital Investment Group filed the paperwork for a BTC exchange-traded fund, and on Jan. 22, Valkyrie Digital Assets proposed listing its Bitcoin trust on the New York Stock Exchange.