In block-buster news on Feb 8, Tesla–the world’s most valuable automobile company whose CEO Elon Musk is known for his pioneering tech ideas, filed with the U.S. Securities and Exchange Commission (SEC), revealing their $1.5 billion Bitcoin purchase. The electric car manufacturer cited the need to diversify and increase their revenue streams.
The Tesla Pump
However, the icing on the cake was that not only will this investment equate to around seven percent of their $19 billion in cash reserves, but they, subject to approvals, will begin accepting BTC as payment. That means, in the years ahead, the electric car manufacturer will accept Bitcoin as payment for its broader ecosystem.
News of Tesla accepting Bitcoin was enough to propel prices above $40k, a foundation that later saw the coin break above $42k (January 2021 highs) in a trend continuation phase. As of writing on Feb 21st, the Bitcoin price was trading above $58k.
Public Companies Already Own over $35 Billion of Bitcoin
Analysts, including Anthony Pompliano and lately, the former White House Communications Director, Anthony Scaramucci, expect the BTC/USD price to reach $100k by the end of 2021.
Specifically, Scaramucci cites the increasing Bitcoin’s liquidity and utility which he says is attractive to institutions.
According to Bitcoin Treasuries, public companies like NASDAQ-listed MicroStrategy control over $60 billion of Bitcoin. Over the last few months, they have gained massive capital gains since Bitcoin prices have more than doubled after breaking Dec 2017 peaks of $20k.
BNY Mellon, the Oldest Private Bank in the U.S. to Offer Crypto Custody Services
Consequently, established financial institutions and infrastructure developers are also angling, searching for opportunities of being integral in Bitcoin and crypto.
A few days after Tesla’s $1.5 billion investment, BNY Mellon, the oldest private bank in the U.S., said it plans to facilitate trading and custody of Bitcoin and leading cryptocurrencies as an asset manager on behalf of their clients.
Accordingly, it became the first national custody bank to commit to providing custody services in 2021. Reports indicate that the push came from the bank’s institutional clients.
Roman Regelman, the head of asset-servicing and digital businesses, said digital assets are becoming mainstream. Accordingly, they expect full integration of digital assets in existing banking infrastructure within the next half a decade.