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Tesla finally explains why he bought the cryptocurrency

 


Tesla brought more light why he made a big purchase of bitcoin.

During the company’s first quarter 2021 results call on Monday, CFO Zach Kirkhorn answered a question regarding the company’s digital currency plans. In his response, he explained why the company announced on February 8 that it had purchased $ 1.5 billion in bitcoin.

Want to learn more about Musks’ future plans, Tesla’s state, and what’s going on with his advanced battery plans? Lily the full transcript, only in Musk reads +.

Elon and I were looking for a place to store money that was not immediately used, trying to get a certain level of return but also preserve liquidity, Kirkhorn said.

The comments follow on what appears to be CEO Elon Musks’ growing interest in bitcoin. In February 2019, he described the structure of the cryptocurrency as pretty bright, but added that it was quite power hungry and he wasn’t sure that would be a good use of Teslas resources to get involved. in cryptography.

That seemed to change this year. In January 2021, Musk added the word bitcoin to his Twitter bio. The following month, after Tesla announced his bitcoin holdings, Musk posted on twitter this money is only data which allows us to avoid the inconveniences of barter.

This data, like all data, is prone to latency and errors, he wrote. The system will evolve towards what minimizes both.

But Kirkhorns ‘comments suggest that Teslas’ purchase of Bitcoin was motivated more by financial reasons than any sort of belief in the future of money. Kirkhorn, who was awarded the coin master title in March 2021, explained that being able to access our money very quickly is very important to us right now.

The price of Bitcoin has skyrocketed in recent months.Shutterstock

This should be especially important as Tesla strives to grow over the coming year. The company aims to start production at two new factories later this year, one in Texas and one in Berlin. Tesla also plans to start production of its semi-trailer, with full-scale production of Cybertruck next year.

Tesla, says Kirkhorn, is also concerned about global issues such as port capacity and semiconductor shortages. On the latter front, he announced in his results report that he had switched to new microcontrollers to avoid the worst effects of the current shortage.

While Teslas’ main motivation may be to find a place to put his money, he has also dipped a toe into full cryptocurrency support. On March 24, Musk announced via Twitter that customers can now buy a car using Bitcoin.

There is a lot of reason to be optimistic here, Kirkhorn said. We’re certainly watching this very closely at Tesla, looking at how the market evolves, listening to what our customers are saying.

the Reverse Analysis Teslas’ reasoning for buying bitcoin seems relatively straightforward, he wanted to invest somewhere with cash. It also seems to have paid off, as the price has risen 25% since the day Tesla announced its purchase.

But bitcoin power consumption, which Musk expressed concerns about in 2019, remains an issue. Cryptocurrency entices miners to process transactions by offering bitcoin as a reward. This forces miners to configure their computers to solve complex problems. If their block is accepted on the blockchain, they receive bitcoin as a reward.

In an article published in the journal Joule in March 2021, data scientist Alex de Vries argued that bitcoin mining would likely exceed an annual energy consumption of 101 terawatt hours.

But Musk suggested that bitcoin could have positive effects on electricity. April 22, at reply to a tweet of Twitter CEO Jack Dorsey, who read that bitcoin encourages renewable energy, Musk wrote true.

Musk still owns Bitcoin himself. In February 2018, he wrote that a friend sent him 0.25 bitcoins many years ago. This month, he confirmed that he has not sold any of his bitcoins.

But as the CEO increasingly refers to the Dogecoin cryptocurrency, more recently in a Twitter message about his neighbor Saturday Night Live Apparently, Musk may not feel tied to bitcoin as the ultimate solution.

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