The move also opens up another way for people looking to invest in bitcoin – via ownership of Tesla stock. The stories circulated over the last few months about the people who may technically be millionaires but are locked out of their gains due to lost passwords, illuminated some of the difficulties of assets secured with cryptography.
This is one of the main tradeoffs for bitcoin: It may be a clever system, valuable, and groundbreaking, but it also has a learning curve. There are platforms that make investing easier, but bitcoin evangelist and Fundstrat founder Tom Lee points to companies like Tesla as another option. If you don’t want to own bitcoin, you can buy a stock instead to get exposure.
Revised list (addition @Tesla)
Ways to use publicly traded instruments to get exposure to #Bitcoin and #digitalassets #crypto
Equities with leverage to $BTC$SI$MOGO$MSTR$PYPL$SQ$BRPHF$TSLA https://t.co/deCnPZLPPL
— Thomas Lee (@fundstrat) February 8, 2021
Bitcoin has risen 32% so far this year and over 272% in the past 12 months.
Silvergate Capital (SI)
Silvergate is a bank that focuses on the digital currency industry. In the company's Q4 earnings report in January, it announced it had deposits of $5 billion in digital currencies — largely in bitcoin. That was about $2 billion more than the previous quarter, fueled by the coin’s rise in value.
Mogo is a Canadian fintech company and finance app that offers a cryptocurrency component for its users. The company announced in late December that it would invest $1.5 million in bitcoin and possibly more in 2021. This was 1.5% of the company's assets at the end of Q3, it said.
In early February, the company announced it saw a 323% increase in bitcoin transaction volume and a 141% increase in new bitcoin accounts in January compared with December.
Microstrategy, a "business intelligence" company, bought $250 million in bitcoin last August, deciding to use it for reserves and continued buying to a total of 71,079 bitcoins. As of Feb. 8, that’s almost $3.1 billion worth of bitcoin.
PayPal allows users to buy and sell bitcoin, but doesn’t plan to have bitcoin on its balance sheet.
Square’s founder and CEO Jack Dorsey has long been a fan of bitcoin, and the company has allowed customers to use it in transactions. Square has a substantial amount of bitcoin on its balance sheet and bought another 4,709 bitcoins in October for $50 million, which is now worth around $200 million. In its third-quarter earnings announcement, the mobile payment company said customers bought $1.6 billion in bitcoin, which represented a profit of $32 million for the company.
The company has 38,250 bitcoins on its balance sheet for a value of around $1.7 billion.
Tesla’s $1.5 billion investment, revealed in an SEC filing on Feb. 8, pushed bitcoin higher.
Galaxy Holdings (BRPHF)
Michael Novogratz’s investment company focuses on digital currencies and said in its Q3 2020 earnings that it had $176.4 million in bitcoin as of September 2020. Today that’s around $718 million.