CFO or Tesla master of coin Zach Kirkhorn reveals why the electric car company Elon Musk is investing in bitcoin. According to him the company believes Bitcoin will live long regardless of its volatility.
Tesla invested US $ 1.5 billion in Bitcoin in February and then reduced its holdings by 10%. This has had a positive impact with the cryptocurrency contributing US $ 101 million to Tesla’s profitability.
Reasons for Tesla Investing in Bitcoin
Zach Kirkhorn explains why they chose to invest in Bitcoin. He and Elon Musk are looking for a company safe deposit box that is not being used immediately. Providing attractive returns and well-preserved liquidity while awaiting the launch of factories in Austrin (USA) and Berlin and the uncertainty of semiconductor and port capacity.
“You know, there aren’t many traditional opportunities to do this or at least we don’t find them. We also talk to other people to get input. Most of them provide low yields without taking additional risks or sacrificing liquidity,” he explained as quoted by Techcrunch, Tuesday (27). / 4/2021).
“At that time Bitcoin met our requirements and so far it has proven to be a good decision. A good place to store cash that is not immediately used for day-to-day operations. Or may not be needed until the end of the year, and can get a return from there.”
Tesla Optimist on Cryptocurrency
Zach Kirkhorn said that he is watching cryptocurrencies closely and that there are many reasons to be optimistic about cryptocurrencies.
“You know from the perspective of the treasury company, we are quite happy with the amount of liquidity in the Bitcoin market. Our ability to build our position first was very fast. When we sold it later in March we were able to execute it very quickly,” he explained.
“When we think about business risk management in terms of global liquidity, being able to get money in and out of the market is something that I think is very important to us.”
Zach Kirkhorn added that Tesla intends to maintain its cryptocurrency in the long term and to continue to accumulate Bitcoin from customer transactions from purchasing electric cars.
