Tesla and Bitcoin

Tesla, the electric cars producer, several months ago announced it will accept Bitcoins in lieu of payment for its cars.

Elon Musk recently started selling large parts of its Tesla stock holdings.

Even Elon Musk seems to have realised that at these stock price levels Tesla is grossly overvalued. Tesla's stock market capitalisation is just a giant bubble, detached from reality and any realistic assumptions for future revenue growth and profitability.

Tesla's Bitcoin exposure could, in fact, provide a new avenue fro growth of the electric vehicles producer. Bitcoin is the new internet or artificial intelligence. The pioneers in Bitcoin will be the leaders of tomorrow.

If Tesla is to substantiate its current market capitalisation, it has to enter and dominate other industries. Finance and Bitcoin is one of them. Unfortunately, Tesla is unprofitable so Tesla will not be able to use cash reserves to enter the cryptocurrency world. The only large value source for Tesla is Tesla's market capitalisation or the equity of the company.

Elon Musk is a very smart man. Some question his integrity, but that is another matter. He has realised that Tesla is very overvalued and seems to be slowly cashing out, arguably to fund new investments, Bitcoin and SpaceX among them. Much like he did with his PayPal's stock holding.

Only time will tell whether Elon Musk will again be right this time. Elon Musk can, however, teach a thing or two investment bankers on company valuation or at least the part based on the public's expectations and market tops.