Tesla’s $ 1.5 Billion Bitcoin Purchase Causes Institutional Uproar

Not all analysts are convinced that Tesla’s recent acquisition of $ 1.5 billion in Bitcoin (BTC) will prove as beneficial for the tech giant as it was for the price of the BTC coin.

Saxo Bank’s Head of Equity Strategy, Peter Garnry wrote in a research note that Elon Musk had exposed Tesla and its investors to “immense risk.”as reported by Reuters on February 11.

“Elon Musk has exposed Tesla to immense market value risk,” Garnry wrote, and He added that investors’ main concern was to value Bitcoin’s long-term value, given the intense market volatility that it has been subject to since its inception.

Elsewhere, former Goldman Sachs executive Gary Black, ad to Twitter followers on February 8 that he had closed the positions held at Tesla Inc ($ TSLA), citing the company’s “riskier capital allocation” among his reasons.

The value of Bitcoin rose 20% in the 24 hours immediately following the news of the $ 1.5 billion acquisition of Tesla, triggering a further surge in the cryptocurrency market that resulted in new all-time peaks for Bitcoin, Ether ( ETH) and many others. Meanwhile, the value of Tesla shares fell 7.5% over the course of the subsequent business days.

At the same time, the response was reported from Brett Winton, research director at ARK Invest, which allocates 8.75% of its portfolio to Tesla stocks, who said the investment represented an “appropriate use of cash”, and He added: “We are comfortable with the way we are forecasting the positions we are putting our clients into.”

The CEO of Grayscale, Michael Sonnenshein recently suggested that Elon Musk’s public vindication of Bitcoin would spark a “race” to invest by institutional buyers and other tech “visionaries.”. Sonnenshein said that Grayscale, which has a keen interest in the matter at hand, has seen stronger inflows toward 2021 than those recorded during the record year of 2020.

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