How Companies like Apple Can Follow Tesla’s Bitcoin Investment

Key Takeaways

  • Tesla revealed it’s $1.5 billion Bitcoin allocation yesterday and began accepting BTC payments.
  •  The news caused TSLA share price to close 1.1% higher with BTC gaining 23.9% from yesterday’s opening to a peak of $48,216.
  • Still, financial managers warn that firms should exercise caution when moving into such a volatile market.

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Tesla’s Bitcoin investment disclosure caused the largest single-day surge in Bitcoin since December 2017 of 19.45%, BTC reached a peak of $48,200 this morning.

After Tesla, opinions rage about which company will follow. Top of the list? Apple.

Bitcoin, Crypto as a Product

RBC Capital Market’s report states that Apple shares can jump 25% if they add buying and selling cryptocurrencies. The recent hype around Bitcoin and crypto markets has seen a massive surge in crypto trading volumes.

The trading volume on itBit exchange, a proxy for crypto purchases at PayPal, surged above $100 million yesterday.  

paypal proxy trading
ItBit Exchange trading volume. Source: Nomics

Bitcoin accounted for nearly 75% ($3.8 billion) of Square’s revenue until Q3.

Square’s Cash App, a rival to PayPal’s Venmo, saw a 7x surge in Bitcoin trading volumes in the first nine months of 2020. Their revenue projection from Bitcoin for 2021 is $9 billion. 

Tech giants like Apple do not require a Bitcoin investment to benefit from the market. During the last bull run, many companies instead leveraged the blockchain narrative for higher valuations. The hype that comes with a crypto bull market favors associated stocks as well. 

For instance, Facebook’s stock jumped 25% after the social media giant announced its cryptocurrency plans in the summer of 2019.  

Currently, all Apple has to do is enable Bitcoin trading like PayPal and Cash App without having to sit through a U.S. Senate hearing like Facebook. Moreover, this will add to Bitcoin’s regulatory push in the U.S. as well. Konstantin Anissimov, executive director at CEX.IO, told…

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