Tesla’s new revenue stream? “Pile up the bitcoins you received as car payments”

Elon Musk, Tesla CEO, posted on Twitter on the 24th (local time). Immediately after CEO Musk’s tweet, Tesla’s U.S. homepage added a button to purchase electric cars with cryptocurrency’Bitcoin’. Tesla electric vehicles currently sold in the US range from $37,990 to $124,000. Considering that the price of each bitcoin is 53,000 dollars (about 60 million won/26th), you can buy anything Tesla car with three bitcoins.

Musk and Tesla have been betting on Bitcoin all the time. Taking the stock market terminology, Tesla is in a’long (buy) position’ in Bitcoin. It is a kind of gambling strategy to receive the purchase price of the vehicle in bitcoin as it is determined that the market value of bitcoin will increase further in the future. Even Musk said, “I will not exchange bitcoins from car sales.” It is bitcoin that cannot be treated as currency according to US accounting standards, but the purpose is to stack it as much as possible.

Tesla also reported to the US Securities and Exchange Commission (SEC) last month that it had purchased $1.5 billion worth of bitcoin (approximately 1.7 trillion won). According to the US economic media Marketwatch, the value of Bitcoin purchased by Tesla once increased to the level of 2.6 billion dollars (about 2.95 trillion won). The valuation profit alone is more than 1 billion dollars (about 1.3 trillion won). This is more than Tesla’s annual net profit of $721 million (about 815 billion won) last year.

Tesla’s net profit, which was recorded for the first time last year, is also more due to the sale of carbon credits than electric vehicles. This is because 13 states in the United States, including California, give car makers carbon credits based on the production of eco-friendly vehicles. Since Tesla only produces electric cars, it can accumulate carbon credits, but other automakers that sell internal combustion engine vehicles have to buy carbon credits from outside. As a result, Tesla made $1.58 billion (about 1.74 trillion won) last year alone by selling carbon credits to other automakers. Excluding the profit from the carbon credit transaction from net profit, Tesla’s annual performance turns into a deficit of $859 million (approximately 960 billion won).

Jacques Kirkhorn, Tesla’s Chief Financial Officer (CFO), said, “In the long run, the sale of carbon credits will be excluded from an important business area. It will remain an important area in only a few quarters.” This is because, as existing automakers such as Hyundai Motor Company, Volkswagen and General Motors (GM) increase their electric vehicle production, Tesla’s carbon credit revenue is likely to decrease.

Some analysts say that Tesla is investing in bitcoin to avoid relying on the electric vehicle manufacturing industry. In fact, Musk had a different business sense of the online financial market. He created’PayPal’, the largest payment service provider in the United States, based on’X.com’, which was founded in 2000. In 2002, two years later, it was sold to eBay for $165 million (about 200 billion won).

In a recent report, Dan Ives, an analyst at Weedbush Securities, said, “If you look at the next year to one year and six months, Tesla’s electric car purchases through bitcoin will be less than 5%.” It will play a role as a game changer in using coins.” He appeared on the US economic broadcaster CNBC last month and said, “Tesla is no longer a car company. Tesla’s stock price is directly linked to the value of Bitcoin.”

Reporter Kim Young-min [email protected]