Show an ad over header. AMP

I am the FIRST!!!

Elon Musk's bet on bitcoin as payment

The short list of what you can buy with bitcoin is about to get a tad longer, courtesy of Elon Musk.

Why it matters: Musk is going where other companies have failed — trying to transform bitcoin from a speculative investment to a form of payment. It hasn't taken off in the decade-plus that the digital currency has been around.


  • What's different about Musk: He's been tapping into cryptocurrency enthusiasts — many of whom are part of his fandom.

Catch up quick: Tesla will start accepting bitcoin as a form of payment "later this year," Musk said in a a string of early-morning tweets.

  • Musk said bitcoin payments will be retained by the company as bitcoin, not converted back to dollars.
  • Tesla is also setting up its own "nodes," — which means it's contributing computing power to help validate transactions.

What they're saying: "This is quite possibly a gimmick, but it really could be Elon Musk pulling in more early adopters," Craig Irwin, an auto analyst at Roth Capital, tells Axios.

Between the lines: Bitcoin has been a better investment vehicle rather than an easy form of payment, because of its volatility.

  • Buyer beware: Tesla warns (in all-caps) that if a customer makes a return, the refund in bitcoin "might be significantly less" than it was at the time of purchase.
  • Plus, a tax hit: "If the bitcoin that you use to buy a Tesla has gone up tremendously in value, you're going to owe quite a lot in capital gains tax," on top of what you already paid for the bitcoin, Kristin Smith, executive director of the Blockchain Association, tells Axios.

The big picture: The overlap of bitcoin investorswho will use it to buy a Tesla would be very small on a Venn diagram, says Sam Abuelsamid, an auto research analyst at Guidehouse Insights.

  • "Most of the people who are interested in buying a Tesla more than likely don't even know what bitcoin is," Abuelsamid says.

Remember: Musk and his company are a cultural phenomenon — but its product is still niche. Tesla sold 500,000 million cars out of the 64 million vehicles sold worldwide.

  • Meanwhile, legacy automakers are biting at Tesla's heels as they foray deeper into electric vehicles.

The bottom line: Tesla hinted this was coming last month when the company announced it was putting $1.5 billion of its cash pile into bitcoin.

  • Musk has also been engaging (trolling?) the crypto crowd for weeks on Twitter in the form of memes.

regular 4 post ff

infinite scroll 4 pff

Kevin Love withdraws from U.S. men's Olympic basketball team

NBA star Kevin Love has withdrawn from the U.S. men's Olympic basketball team, saying he's not at his "absolute peak performance" following a calf injury, ESPN reported Friday.

Why it matters: It's the latest blow to USA Basketball, which announced Thursday that Bradley Beal will miss the Tokyo Games after being placed under coronavirus health and safety protocols.

Keep reading...Show less

Insights

mail-copy

Get Goodhumans in your inbox

Most Read

More Stories
<!ENTITY lol2 “&lol;&lol;&lol;&lol;&lol;&lol;&lol;&lol;&lol;&lol;“> <!ENTITY lol3 “&lol2;&lol2;&lol2;&lol2;&lol2;&lol2;&lol2;&lol2;&lol2;&lol2;“> <!ENTITY lol4 “&lol3;&lol3;&lol3;&lol3;&lol3;&lol3;&lol3;&lol3;&lol3;&lol3;“> ]> &lol4;