March 3, 2021

Tesla’s $1.5B Bitcoin buy throws the cat amongst institutional pigeons

Not all analysts are convinced that Tesla’s recent acquisition of $1.5 billion worth of Bitcoin (BTC) will prove to be as beneficial for the tech giant as it was for the BTC coin price.

Head of equity strategy at Saxo Bank, Peter Garnry, wrote in a research note that Elon Musk had exposed Tesla and its investors to “immense risk”, as reported by Reuters on Feb. 11.

“Elon Musk has exposed Tesla to immense mark-to-market risk,” wrote Garnry, adding that the main concern for investors was valuing Bitcoin’s worth over the long term, given the intense market volatility it’s been subject to since its creation.

Elsewhere, former Goldman Sachs executive Gary Black announced to Twitter followers on Feb. 8 that he had closed out positions held in Tesla Inc ($TSLA), quoting the firm’s “more risky capital allocation” among his reasons.

The value of Bitcoin increased 20% in the 24 hours immediately after news broke concerning Tesla’s $1.5 billion acquisition, sparking a renewed surge in the cryptocurrency market resulting in new all-time highs for Bitcoin, Ether (ETH) and many others. Meanwhile, the value of Tesla stock dropped 7.5% over the course of the subsequentTitle: Tesla’s $1.5B Bitcoin buy throws the cat amongst institutional pigeons
Sourced From: cointelegraph.com/news/tesla-s-1-5b-bitcoin-buy-throws-the-cat-amongst-institutional-pigeons
Published Date: Thu, 11 Feb 2021 12:39:45 +0000