Bitcoin Reaches All-Time Highs, Sweeps Media Attention After Tesla's $1.5 Billion BTC Buy

February 9, 2021 03:00 PM
Crypto Story of the Day

Crypto Story of the Day




Bitcoin (BTC) has pushed to new all-time highs, trading to roughly 48,200 overnight. Spot volumes are seeing some of the highest levels this month on the move.  

Crypto Story of the Day

Tesla’s (TSLA) revelation yesterday that it’s purchased USD 1.5 billion-worth of BTC and plans to accept the coin as payment has pushed BTC to new record highs and invited a flurry of speculation on what the move means for the asset.

Tesla’s move into BTC follows a week during which MicroStrategy’s “Bitcoin for Corporations” conference dominated crypto headlines and social media discourse. That event, which sought to pitch BTC as an inflation hedge and provide corporations with resources to gain exposure to the coin, “attracted 8,197 attendees from 6,917 different enterprises,” according to MicroStrategy CEO Michael Saylor. 

As such, significant attention was being afforded to the notion of BTC as a treasury reserve asset and broader corporate involvement in the asset class. In a Monday research note, RBC Capital Markets analyst Mitch Steves speculated that Apple could benefit from a move similar to PayPal’s and Tesla’s. Steves wrote that Apple has a “clear opportunity” to offer the buying and selling of crypto and that the firm could consider adding BTC to its balance sheet, “which would send even more users to ‘Apple Exchange.’” 

In nearly rolling coverage of the move by Tesla on CNBC, pundits discussed the regulatory implications. For example, pundits considered [minute 5:18] the possibility of BTC displacing the U.S. Dollar as a global reserve currency. When asked “what can they do?” in reference to regulators, a commentator answered, “they can regulate the hell out of it.” 

In another segment on the network, former SEC Branch Chief Lisa Braganca reiterated [minute 6:28] “[BTC], no question it's a commodity.” In yet another CNBC segment, Jeff Kilburg, the CEO of wealth management firm KKM Financial, said [minute 11:35] that he is “optimistic” about the prospect of the SEC approving a BTC ETF in 2021 and that broad mainstream adoption by the likes of Tesla and PayPal has led to the “maturity of [BTC] actually being confirmed today.” 

Crypto incumbents, such as Galaxy Digital CEO Michael Novogratz, argued that “[y]ou’re going to see every company in America do the same thing” in an interview with Bloomberg Television. Financial Times reported that their most read story of the day was about Tesla’s BTC investment. Several hours after the announcement, Miami Mayor Francis Suarez tweeted “[w]orking on a resolution for our commission for this Thursday’s meeting to get the ball rolling…[Musk’s] announcement was very helpful.”

Media pundits and crypto-native business leaders that joined news programs throughout the day treated Tesla’s announcement as a historic moment. For BTC’s earliest and most ardent investors, the coin’s ethos is being validated by prominent investors and corporations on a regular basis now. 

On a practical front, Michael Saylor argued that “[Tesla] has de-risked the acquisition of [BTC] by public companies and accelerated the digital transformation of corporate balance sheets.” Whatever the practical outcome may be, the variance in comments seen by pundits over the last 24 hours— from questioning the asset’s regulatory status, to its competition as a reserve currency with the US dollar, to asking “who’s next?”— shows that BTC is still far from securing a firm vision and understanding for what the future holds for the asset. Despite a mainstream embrace, the asset is still extremely nascent and its future use remains the subject of diverse speculation.   

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