Bitcoin's Future: Will Tesla Adoption Drive Value?

Electric automaker Tesla has invested around $1.5 billion in Bitcoin. Also, Tesla has planned to accept digital currency as payment for its high-end vehicles. Bitcoin holders sooner will be able to cash in some of their investment in the digital currency for a brand-new electric car.

Bitcoin has unsheathed enthusiasts for its shortage and security, but the volatile digital currency still is not widely used to pay for goods and services. It’s mostly been a store of value, like gold, with some limited merchants like Overstock accepting bitcoin for payment. It’s also used by those distrustful of the banking system or criminals seeking to launder money.

There is a high possibility that Tesla’s acceptance of Bitcoin for transactions will surely be followed by other major companies.

With Tesla investing in Bitcoin, the price of Bitcoin has risen to 15.4% to around $44,500. A vehicle is a large purchase that can make Bitcoin a better fit to pay for it as Bitcoin is the most secured digital currency. But price fluctuations in Bitcoin can be a risk for the merchant who accepts it.

It seems that beyond adopting it as a store of value for own trust or own assets, Bitcoin will appear as a transactional tool as well.  The increase in the value of bitcoin depends on the fact that Tesla gets a decisive competitive advantage in accepting Bitcoin.

Similar to Tesla, Virginia-based MicroStrategy Inc. disclosed that it would use some of the excess cash on its balance sheet to invest in alternative assets such as Bitcoin. This move has paid off so far.

The electric car company, Tesla’s latest change of direction on its acceptance of bitcoin once again highlighted the continuing ability of Tesla’s billionaire chief executive to influence the price of bitcoin and other cryptocurrencies. There is a chance for the rise of Bitcoin value after it gets accepted for transactions by Tesla.