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Cryptocurrencies are still a matter of contention, despite the growing tendency not only for investors, but also for countries to officially or semi-officially recognize them.
With the growing recognition of Bitcoin and the growing acceptance of it by the public, which is one of the characteristics of the currency which is that it is widely accepted, there is another characteristic that Tesla may have. approved today that Bitcoin is a store of value in the eyes of the company.
Elon Musk, CEO of Tesla, whose market capitalization exceeds $ 795 billion, which is the highest market value for an automaker, announced that Bitcoin has started to be accepted to buy Tesla cars in the States, this which had been announced earlier in a disclosure to the Stock Exchange.
But what is interesting is that he confirmed that the Bitcoin from the sale will not be converted to conventional currencies, which is a further change in the currency that has become a store of value for Tesla.
Bitcoin as a store of value
The individual sells the commodity and gets money in exchange; if he wants to keep it, this means that this currency has become a store of value over time, and thus constitutes a means of transferring purchasing power. to the future.
Successful currencies have key characteristics, which are scarcity, fragility, portability, utility, durability, and the difficulty of counterfeiting.
the bet
Bitcoin derives its value from the fact that it has most of the six characteristics, albeit in different proportions, but its main problem is its ability to be a store of value, according to John P. Keelher, cryptocurrency specialist and founder of Level K.
Bitcoin
However, some of the things that hinder the use of Bitcoin are its portability and use, according to Kelleher.
However, if Bitcoin could acquire 15% of the global currency market, and assuming the total Bitcoin in circulation is around 21 million currencies, the unit price of Bitcoin would reach $ 514,000.
American Federal
Tesla’s announcement came two days after statements from US Federal Reserve Chairman Jerome Powell who said cryptocurrencies are still an unstable store of value and the US Federal Reserve is in no rush to present a competitor for the currencies currently traded. .
“These currencies are very volatile, so they are not a real store of value, nor are they backed by anything,” he said.
He believes that these currencies are speculative assets, and can be used as an alternative to gold rather than an alternative to the dollar.
Speculative tools
Mohamed Damak, credit analyst at S&P, says regulators and growing trust between people are the keys to wider use of cryptocurrencies.
He added that the volatility of cryptocurrency prices poses limited risk to the financial institutions we rank. He continued, “We believe the collapse in the value of cryptocurrencies will be just a small wave in the financial services industry.”
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