From a corporate cash flow perspective, we were quite happy with the liquidity of the Bitcoin market. We were able to build our first position very quickly. When we made the sale in March, we were also able to execute it very quickly. When it comes to overall liquidity and risk management, being able to get cash in and out of the markets is very important to us. - Zachary Kirkhorn, Tesla's financial officer
Tesla sent a bullish signal to the business community when its CFO, Zachary Kirkhorn, claimed that Bitcoin has "long-term" value and could be used to address liquidity issues.
At an investor conference covering the first quarter of fiscal 2021 results, Tesla confirmed that it sold 10% of the BTC holdings it bought earlier this year. The automaker justified the sale by saying the company wanted to use BTC to boost its cash flow when needed.
The CFO also explained that Tesla and its CEO Elon Musk made this foray into the BTC market earlier this year based on the company's liquidity strategies.
Elon and I were looking for a way to store cash that was not immediately used in order to try to achieve some level of return on investment while preserving cash. [...] And there are not many traditional opportunities to achieve this goal, [...] with a satisfactory return, especially with such low rates and without taking additional risk or sacrificing liquidity - Zachary Kirkhorn, Tesla's financial officer
Apparently, Bitcoin has proven to be an excellent investment for some of their cash that is not immediately used for day to day operations.
On social media, some crypto-skeptics have expressed dissatisfaction towards Elon Musk about the sale:
Musk was quick to refute this accusation:
Finally, Tesla believes in the long term value of Bitcoin, so they intend to keep what they have and continue to accumulate bitcoins through the transactions of their customers who buy vehicles.
Other tweets of some crypto-skeptics who have expressed dissatisfaction about the sale:
And you ? What do you think about this news ? Feel free to express yourself in the commentary section.
