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Tesla Inc (NASDAQ: TSLA) Investor Ron Baron says the company’s decision to invest $ 1.5 billion in Bitcoin (BTC) and accept digital currency as a payment option is “not surprising.”
Musk loves Bitcoin: Tesla CEO Elon Musk has “commented favorably” on bitcoin for some time, Baron said in a statement to CNBC. It is likely that Tesla is not “speculating on the price of bitcoin”, but rather using it as a payment system.
Other heavy investors such as Stanley Druckenmiller and Paul Tudor Jones, CIO of Tudor Investment Corp., are also bullish on bitcoin, while companies like Paypal Holdings Inc (NASDAQ: PYPL) are expanding their digital currency offerings.
“I’m sure Tesla’s purchase of bitcoin has given a lot of thought and I can’t wait to learn the reason,” said Baron, CEO, President and Portfolio Manager of Baron Funds.
Related Link: 15 Bitcoin Stocks To Watch On Tesla News
Gene Munster of Loup Ventures also enjoys movement.
“Tesla has money to lose with $ 19 billion in assets,” Munster told Benzinga. “Yes, Bitcoin can move the needle for Tesla. If it goes up 10 times, that’s $ 15 billion for Tesla. It’s real money.”
Bitcoin investment: Tesla’s decision to allocate around 7.5% of its total money to bitcoin and could be seen as a signal to customers that it “understands where the world is going,” Michael Novogratz, CEO of Galaxy Digital, told CNBC . People want to do business and invest in companies that look forward to the next 100 years – not the last 100 years.
On the other hand, Musk shouldn’t be tweeting about Dogecoin as the appreciation of the digital currency has reached a point where some people will lose a lot of money, he said. The digital coin has no real purpose, unlike Bitcoin or Ethereum and the like.
“It was funny for a little while,” Novogratz said.
Difficult to prove manipulation: Musk has been bullish on bitcoin for some time and it raises the question of whether his public comments can be seen as market manipulation. Muddy Waters Research founder Carson Block said he doesn’t think that’s the case.
Musk is far from the only notable figure in the investment community to publicly comment on what he’s optimistic about. Musk’s comments are no different from Chamath Palihapitiya confirming he’s long GameStop Corp. (NYSE: GME) call options.
Meanwhile, the US Securities and Exchange Commission “has no success” against Musk, Block told CNBC. As such, any investigation would likely lead to a “dead end”.
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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