Could Bitcoin (BTC) be coming back to strongly trot in the head of Tesla and its founder, Elon Musk? In an official accounting document, published last month, the company had already revealed that it may well revive the possibility of crypto transactions. But couldn’t a massive new purchase of BTC also be in the cards?
Musk’s billions soon to be injected into Bitcoin?
Back in February 2021, billionaire Elon Musk and his Tesla company had caused a stir in the cryptosphere, announcing the purchase of $1.5 billion in bitcoins for the electric vehicle company.
Although he owns bitcoins, ethers (ETH) and dogecoins (DOGE), Musk holds most of his personal wealth in Tesla stock. Now, major tax reforms in the U.S. are making him wonder what he might do with it.
In what is being dubbed the « Billionaires’ Tax, » current U.S. Treasury Secretary Janet Yellen would like to tax the unrealized gains of the wealthiest people in the United States.
As AMBCrypto points out, this could affect about 700 people in the country, including of course our whimsical Elon Musk – who is in a tug-of-war with Amazon’s Jeff Bezos as the richest man on the planet – although with the recent surge in Tesla’s stock, Elon is clearly outrunning Jeff.
The founder and CEO of Tesla and SpaceX thus comes to ask his nearly 63 million Twitter followers the following question (while promising to comply):
« There’s been a lot of talk lately about unrealized capital gains as a means of tax evasion. So I propose to sell 10% of my Tesla shares. Do you agree? »
Michael Saylor’s $24 billion BTC idea
At the end of his poll (with more than 3.5 million participants), Elon Musk saw a fairly large majority – 57.9% – advising him that, yes, he should sell back 10% of his shares. That’s 19.3 million TSLA shares at about $1,230 a share (as of this writing), or a whopping $24 billion.
Bitcoin’s fervent – not to say fanatical – advocate, Michael Saylor, CEO of MicroStrategy, was quick to jump into the breach, advising Elon Musk of another strategy, which is to convert Tesla’s balance sheet into BTC altogether:
« If the goal is diversification, another strategy to consider is to convert Tesla’s balance sheet into the Bitcoin Standard, and buy $25 billion in BTC. This would provide diversification, inflation protection, and more benefits for all investors in a tax efficient manner. »
Not sure if this helps Elon Musk with his tax problems, but Michael Saylor is no longer on his first ultra-maximalist statement about Bitcoin.
It remains true, however, that Tesla has also seen its unrealized earnings explode from simply holding BTC. Musk’s company has, in fact, now reaped more than $1 billion in unrealized capital gains on its February 2021 bitcoin purchase.