Bitcoin jumps 10% to record high on Tesla investment news

LONDON: Bitcoin jumped more than 10% on Monday to a record high after Tesla said it had invested $1.5 billion in the most popular cryptocurrency last month.

The news sent Bitcoin soaring as high as $43,625 as of 1300 GMT. Smaller cryptocurrencies including ethereum and XRP that tend to move in tandem with bitcoin also jumped, rising as much as 5% and 4% respectively.

The electric carmaker unveiled the investment ten days after its chief executive Elon Musk drove up the cryptocurrency’s price by adding a “#bitcoin” tag on his Twitter profile page.

Musk removed the tag from his Twitter bio a few days later but has continued talking up bitcoin and other cryptocurrencies, in particular, dogecoin, to his 46 million Twitter followers.

In December, he had mooted the possibility of converting “large transactions” of Tesla’s balance sheet into bitcoin.

Bitcoin is up almost 50% this year following gains of over 300% in 2020.

About Bitcoin

Bitcoin is a cryptocurrency created in January 2009 following the housing market crash. It follows the ideas set out in a whitepaper by the mysterious and pseudonymous Satoshi Nakamoto. The identity of the person or persons who created the technology is still a mystery.

Bitcoin offers the promise of lower transaction fees than traditional online payment mechanisms and is operated by a decentralized authority, unlike government-issued currencies.

There are no physical bitcoins, only balances kept on a public ledger that everyone has transparent access to, that – along with all Bitcoin transactions – is verified by a massive amount of computing power. Bitcoins are not issued or backed by any banks or governments, nor are individual bitcoins valuable as a commodity.

Despite it not being legal tender, Bitcoin charts high on popularity, and has triggered the launch of hundreds of other virtual currencies