Tesla in Bitcoin’s driver’s seat, sending the crypto’s prices to the roof, literally
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Tesla in Bitcoin’s driver’s seat, sending the crypto’s prices to the roof, literally

Tesla in Bitcoin’s driver’s seat, sending the crypto’s prices to the roof, literally

Elon Musk is powering electric cars, homes and now he's trying to give homeowners the chance to mine Bitcoin using his solar panels. He's got vested interests

  • Your home can allow you to generate actual Bitcoins with the surplus energy your solar system makes
  • Musk is now tied to the bitcoin story in the eyes of the Street
  • Tesla could have made more in profits from its recent bitcoin investment than it has made selling EVs

Tesla made a substantial investment in Bitcoin and allowed the cryptocurrency to be used for car purchases in the future perhaps as a way of differentiating Tesla from other auto manufacturers. 

But besides cars, Tesla's other significant business involves solar panels, solar roofs, and batteries. The batteries are used in their cars and provide power storage for their residential solar systems, sold as the Tesla Powerwall.

Powerwalls can store that surplus energy and power various things in your home, including air conditioners, and charge your Tesla EV.

But Tesla added a capability to its on-premises solar energy/battery energy management computer that would give it GPUs for mining cryptocurrencies.

These are already connected to home Wi-Fi. They have a management app, so upgrading it with Wi-Fi 6 and attaching it to a cryptocurrency network and an easy-to-use mobile app for cryptocurrency account management would be an achievable systems integration effort for Tesla, given the company's considerable engineering resources. 

It would then be possible for your home to become the ultimate idle money-producing game allowing you would generate actual Bitcoins with the surplus energy your solar system makes. 

How smart is that? And just how many birds can Musk hit with one stone?

The key is you need areas with plenty of sun and fewer high-rises and plenty of those exist around the world.  

A Tesla solar-paneled roof, on average, will cost $50,000 (to $75,000) or just about the cost of one Bitcoin today. A good mining machine will set you back another $5000 and voila! You’re all set. 

Of course, not that simple and there’s plenty of technical issues to be solved before any of this happens, but what a way to sell solar panels and drive Musk’s beloved Bitcoin prices to the roof, quite literally.

Talking about power…

As Texas continues to struggle with major blackouts, some of its residents are finding innovative ways to provide power to their homes, using their cars' battery packs, including Tesla’s.

Local Tesla owners have used the Tesla Powerwall to provide backup power during the outages and many such owners have taken to Twitter and Reddit to share the wonders of their savior Powerwalls, or simply their seemingly heroic Teslas. 

EV adoption is skyrocketing globally, led by China, and Tesla is well-positioned to capitalize on this $5 trillion market over the next decade.

Read: If S&P 500 companies invest 1% of their cash in Bitcoin, look for BTC at $400,000

Read: Tesla or Bitcoin? Two ground-breaking assets of the “COVID-era”

Tesla and Bitcoin share a destiny

Tesla’s share price is now directly linked to the price of bitcoin after Elon Musk’s company invested $1.5 billion into it, according to Daniel Ives, an analyst at Wedbush.

“Musk is now tied to the bitcoin story in the eyes of the Street and Tesla made a billion paper profit in its first month owning the digital gold,” Ives told CNBC recently.

Ives estimated on a recent Monday that Tesla has already made over $1 billion off its investment in the cryptocurrency. 

Shares of Tesla fell more than 11% when the market opened on Tuesday, February 23, 2021, a day after the stock’s biggest loss in months. Tesla shares closed down 8.55% a day earlier. 

Bitcoin’s price descended further on Tuesday after U.S. Treasury Secretary Janet Yellen issued a warning about the cryptocurrency, but also after Musk tweeted about the cryptocurrency, raising alarm bells in some corners.

The billionaire changed his Twitter bio to BTC last month, causing it to surge 20%, and recently he said the price of bitcoin and Ethereum seemed “high,” resulting in a sharp fall.

Yellen called bitcoin an “extremely inefficient way of conducting transactions” and warned about its use in illicit activity. She also sounded the alarm about bitcoin’s impact on the environment. The token’s wild surge has reminded some critics of the sheer level of electricity required to produce new coins.

Hence the logic and push behind Musk’s solar panels, get it? 

Bitcoin plunged from highs of $58,000 to below $50,000 and trade as low as $45,000 at some point. It has since recovered to $50,000, in keeping with its volatile nature. 

Tesla’s profits overshadowed by Bitcoin

Tesla could have made more in profits from its recent bitcoin investment than it has made selling EVs, Yahoo! Finance reported

In January, Bitcoin traded between $29,333 and $37,202. Tesla’s big purchase could have been around 44,079 bitcoins depending on the price at the time. 

With these numbers in mind, Yahoo! Finance noted that the value of Tesla’s bitcoin was worth the following scenarios:

  • 51,137 Bitcoin: $2.48 billion, a profit of $0.98 billion.
  • 44,079 Bitcoin: $2.14 billion, a profit of $0.64 billion.
  • 37,020 Bitcoin: $1.79 billion, a profit of $0.29 billion.

Using just that average estimate of 44,000 bitcoins, the total value would now be $2.545 billion, for a profit of more than $1 billion more than its entire business during the fiscal year of 2020, the company’s first profitable year.

Author
Hadi Khatib

Hadi Khatib is a business editor with more than 15 years' experience delivering news and copy of relevance to a wide range of audiences. If newsworthy and actionable, you will find this editor interested in hearing about your sector developments and writing about it. [email protected]

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