Today, Monday morning on February the 8th, we all woke up with our post-Super Bowl hangover to realize that Tesla had just purchased $1.5B in Bitcoin for it’s balance sheet. This comes on the heels of 2 week crypto marathon where Dogecoin has been one of the best performing cryptos. But it may all have a purpose beyond r/WSB and the Hedge Funds.
Elon Musk has generally stayed quiet on his opinion of Bitcoin and the crypto market over the years. Not until lately has he become more vocal and an actual investor, and advocate! What didn’t add up was Tesla’s Bitcoin purchase this morning. Elon Musk likes to be a first mover and innovator, but why was this purchased timed so strategically? For a Monday morning on an open market (versus using OTC)? The day after the Super Bowl when traders are all hungover? After nonstop promotion of Dogecoin?
This is what happened and what’s likely the reason — Elon Musk was actively stress testing the crypto markets by piggy-backing on Dogecoin. This allowed him to gauge how much he could move the market with his massive Twitter megaphone. If he could nudge Dogecoin to all-time-highs with a circulating supply over 128 billion, then he could massively move the Bitcoin price with an open market purchase.
He probably has incentive to nudge Bitcoin to an all-time-high and upwards because he likely has millions, if not billions, of dollars in Bitcoin and cryptocurrency already. Along with the added publicity that is now driving the Tesla stock price even higher, it’s a good investment for his company to make and put on their balance sheet.
Looking at how much money MicroStrategy and MassMutual have made thus far on their respective Bitcoin acquisitions, this makes sense for Elon if he wants to be an early mover (in terms of institutional investors). I imagine this is only the first wave of new money into Bitcoin that we’ll see throughout this week. Especially since Michael Saylor has been urging “big money” to spill over into Bitcoin.
I could be wrong and Elon could just be making what he deems is a diversified investment, but I think there’s a bit more to this financial game we all play. Either way, one of the most iconic Men ever has just nudged Bitcoin further into relevancy.