"I don't think there is a prescient need if you are CFO of an important global company to have bitcoin on the balance sheet right now, especially if you were not buying gold to hedge currency risk as we think now of bitcoin as an option on gold," Casares told the CNBC Global CFO Council on the recent virtual event. J&J CFO on Q1 earnings beat, Covid vaccine pause in U.S. PepsiCo CFO Hugh Johnston on Q1 results, growth outlook, competition, world already wastes tons of energy in no useful activity and bitcoin mining uses a roughly miniscule percentage, Diem, the blockchain-based global payments project, Musk hinted soon may be the case for Tesla, central bank digital currencies are coming. I think individuals have a different risk tolerance and threshold as opposed to corporations," he said. ... We haven't seen something like this in hundreds of years. Nevertheless, CFOs see value in bitcoin and are putting their personal funds into it. "Most people can afford to lose 1%," he said. Get this delivered to your inbox, and more info about our products and services. "It will take decades for bitcoin to hit cruising altitude and it is hard for me to imagine it becoming less volatile," Casares said. Even if bitcoin does not turn out to be a singular crypto winner of the future, central bank digital currencies are coming, with China moving ahead and the Federal Reserve currently studying the issue and expected to release a white paper with MIT covering its views. © 2020 Fortune Media IP Limited. © Provided by Benzinga Tesla Inc (NASDAQ: TSLA) CEO Elon Musk on Thursday gave an indication on why the electric vehicle maker invested in Bitcoin (BTC) … Elon Musk Cyptocurrency enthusiasts got a nasty shock Wednesday when Elon Musk, founder of Tesla Inc. and the second-richest person on the planet, announced on Twitter that his automaker wouldn’t accept payment in Bitcoin any more due to environmental concerns. I cannot imagine a Fortune 500 company having a CFO who does not understand it well, and early. But all the gains it’s made since Tesla publicly embraced the crypto have been wiped out by… Elon Musk. Experts say there is no compelling reason for a company to hold bitcoin on its balance sheet today, but they do think C-suites should educate themselves on crypto sooner rather than later, and climate is no reason to wait. Back in 2018, Elon Musk owned only a small amount of cryptocurrency at 0.25 BTC. "It is so asymmetrical. ET First Published: May 17, 2021 at 2:23 p.m. Why Elon Musk was wrong to get Tesla into bitcoin in the first place Published Sun, May 16 2021 11:24 AM EDT Updated Mon, May 17 2021 9:39 AM EDT Eric Rosenbaum @erprose David Sackett, CFO at ULVAC Technologies, a Massachusetts-based semiconductor supply subsidiary of a $2 billion market Japanese firm, has been a bitcoin investor for years, and as he watched the volatility of the cryptocurrency — rising and crashing hard and then rising again to a new high each time — he says as a finance executive what he sees is a scarce resource subject to supply and demand. Elon Musk's abrupt reversal on bitcoin conflicts with research from Cathie Wood's Ark Invest that argues mining is actually environmentally beneficial Isabelle Lee May. The popular cryptocurrency fell by … He finally did it. Mike Novogratz said bitcoin will be stuck somewhere between $40,000 and $50,000 for up to six weeks. All rights reserved. "But they are not comfortable putting their companies excess cash into it.". Among U.S.-based CFOs, specifically, the percentage saying bitcoin is for real doubled as well, from 33% to 65%. ", "It's hard to have a view if you're not educated," said Rob Massey, Deloitte's global tax leader of blockchain and cryptocurrency. Elon Musk's car firm Tesla has said it bought about $1.5bn (£1.1bn) of the cryptocurrency Bitcoin in January and expects to start accepting it as payment in future. The market cheered when Musk announced that Tesla would accept Bitcoin as payment. "Don't run towards it, but have a point of view based on information and experience. "It is hard to understand here we have the bones for something to happen that would be more relevant to a CFO than anyone else in a company and you'll do better if you learn it sooner rather than later," he said. He pegged the chances of losing your investment at 10% to 15%, and a higher than 60% chance it is 100x gain. Earlier today Tesla disclosed to the SEC that it has invested a staggering $1.5 billion into Bitcoin. The climate dynamics of crypto are complicated, but it's simply not what corporations should be focusing on. Sackett, who allocated 10% of an individual retirement account to bitcoin in 2017, has been taking that message to his board. "I think, like everyone else, I wanted to diversify my portfolio. Roughly three-quarters of mining operations use some renewable energy and 39% are entirely renewable (when hydropower is included), according to Cambridge researchers, who say the topic continues to be "misrepresented.". "It feels speculative to me. Elon Musk was one of the first prominent individuals to embrace cryptocurrencies. Elon Musk, Tesla Shock World with Massive $1.5b Investment in Bitcoin. "There is a correlation between appreciation of an asset and volatility and bitcoin has been the best-performing asset in recent years, and it has been the most volatile. "Let's have some available so when it does take off, this company benefits," he says of his pitch to the board. In fact, Casares says a CFO who holds the view that bitcoin should not be a balance sheet holding is the one taking the correct view, and it is a view that Musk hinted soon may be the case for Tesla again in a Sunday afternoon tweet insinuating the company might unload the stake, or already was in the process of doing so, even though his tweet earlier this week indicated the balance sheet stake would remain. CFOs never like to get caught off guard," Bant said. Consider Musk’s latest vaporous cloud — the announcement on Feb. 8 that his Tesla electric car company had made a $1.5-billion investment in the cryptocurrency bitcoin starting in January. DOGE-USD Elon Musk sent Bitcoin (BTC) reeling on Wednesday, after he announced that Tesla (TSLA) would stop accepting it for car purchases — … "I don't understand why he said that, because I would expect him to understand how mining works," said Wences Casares, CEO of digital bank and bitcoin custodian Xapo, speaking at the same CNBC CFO event, and noting that the world already wastes tons of energy in no useful activity and bitcoin mining uses a roughly miniscule percentage of world energy, and much of its operations already are renewable. Bitcoin has tumbled around 30% from record highs after Elon Musk … Bant and Sackett share one view on bitcoin: owning it as an individual investor is an important part of coming to better understand it, even if that doesn't also hold true for corporations as an investment rationale. Data from a recent CNBC survey shows that more company finance chiefs are taking bitcoin seriously. To experts who advise corporations, and to a growing group of chief financial officers, Musk's back-and-forth on bitcoin does speak to real issues: Should more corporations be adding bitcoin to the balance sheet? Elon Musk Sends Bitcoin Tumbling With Stunning U-Turn On Payments In a post on Twitter Wednesday, Elon Musk cited concerns about "rapidly increasing use of fossil fuels for Bitcoin … Now, his tweets are scaring them off. Employees work on bitcoin mining computers at Bitminer Factory in Florence, Italy. Elon Musk’s decision to stop Tesla from accepting bitcoin as payment has led to fresh scrutiny of the cryptocurrency’s environmental impact. We want to hear from you. ", More CFOs are making that move as individuals. Elon Musk hints that Tesla may dump its billion dollar Bitcoin investment — here’s why his tweets have so much power BI India Bureau May 17, 2021, 10:12 IST I don't have a good argument for that, but it would be a disservice if I said you can forget about this for now.". One recent tweet referred to the "joke" cryptocurrency dogecoin that Musk has promoted as having a future in which it "wins hands down.". One way to prepare for the world of CBDCs is to engage with cryptos now. Elon Musk is known for a brain that combines the capabilities of a rocket-science supercomputer and self-driving algorithm, an ability to see the future that has paid off in one of the world's biggest billionaire fortunes, and market's largest companies, by being ahead of others in taking risks on going to Mars, electric cars and, long before that, a first big idea, finding and paying for things on the internet. Though his favourite is still Dogecoin, he also invested a lot in Bitcoin. So does investor and Dallas Mavericks owner Mark Cuban. "It's hard for a company to make a decision if they are not informed, and we are still in the education phase," said Amy Park, U.S. audit & assurance blockchain & digital assets partner at Deloitte. "If more people were educated on it I think more people would be open to it," he said. But his recent investment of $1.5 billion through Tesla made him one of the largest BTC holders globally. Elon Musk's tweets have contributed to Bitcoin's volatility, with the coin losing a quarter of its value over the past week. Elon Musk has been a big cryptocurrency booster of late, even directing Tesla to buy $1.5 billion in Bitcoin for its corporate treasury earlier this year. In context: Bitcoin’s surge in recent times owes a lot to Elon Musk. Sign up for free newsletters and get more CNBC delivered to your inbox. Got a confidential news tip? But that doesn't mean that on bitcoin, which Musk bought for Tesla's balance sheet earlier this year and profited from in the first quarter, he is out ahead in a way that other executives should be following. Bitcoin and Tesla (NASDAQ:TSLA) both slumped in after-hours trading after a critical tweet by CEO Elon Musk. "Several CFOs have told me that they are investing in bitcoin personally," said Jack McCullough, who runs the CFO Leadership Council. Your guide to the cosmic-themed cryptocurrency, Bitcoin is boring now—which means it’s the perfect time to buy, CA Notice at Collection and Privacy Notice, http://www.djindexes.com/mdsidx/html/tandc/indexestandcs.html. Economist Nouriel Roubini also criticized bitcoin and the growing trend in bitcoin investment, spiked by endorsements from Tesla chief Elon Musk. Bitcoin has hit record highs for a second day after Elon Musk's car company Tesla said it had bought about $1.5bn (£1.1bn) of the cryptocurrency. Elon Musk, the chief executive of Tesla, recently announced his company had bought US$1.5 billion (almost A$2 billion) of Bitcoin.The announcement … 13, 2021, 12:12 PM FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. Elon Musk’s whims are among the main drivers of Bitcoin’s price, so : The largest cryptocurrency dropped as much as 15% to just above $46,000, before paring some of the retreat. Tesla CEO Elon Musk is wading back into the cryptocurrency fray, while ARK Investment Management CEO Cathie Wood is sticking her bullish Bitcoin thesis. Alexander Bant, chief of research in Gartner's finance practice, says he sees most CFOs now saying bitcoin is not a fad, but they still see a high degree of risk due to the volatility and regulatory concerns. Woman loses £9000 to scam in Elon Musk's name. ELON MUSK's investment in Bitcoin was a highly speculative move, which could have gone either way, a financial adviser has told Express.co.uk. Tesla’s Elon Musk -- a long-time proponent of cryptocurrencies -- has sounded a note of caution for investors looking to gain from the boom in the prices of Bitcoin… A woman lost £9000 in a bitcoin fraud that cashed in on Musk’s association with the currency. The answers: maybe "no" and "no." Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell My Personal Information | Ad Choices Now, in citing the climate risks of bitcoin this past week as a reason to suspend the ability of Tesla customers to use the cryptocurrency as a payment method, Musk was entering a debate over the climate implications of bitcoin that isn't news to anyone who has followed the market for years. Elon Musk impersonators cost consumers more than $2 million in cryptocurrency scams, FTC says Last Updated: May 18, 2021 at 10:40 a.m. It is the essential source of information and ideas that make sense of a world in constant transformation. ... bitcoin was the preferred investment choice among 200 of … ... Elon Musk Announces He Will Be 'Off Twitter for a While' Start your unlimited Newsweek trial. ... Cryptocurrency can be a big opportunity for anyone who cares about clean energy," Whittaker said on a CNBC Global CFO Council virtual event this past Thursday. "I'd rather get in now when the price is relatively low than when it is super high.". Tesla's $1.5 billion Bitcoin investment unveiled on Monday may not surprise CEO Elon Musk's followers on Twitter, where he has shown himself … It is new and complicated and that is why the board should be asking, 'are we doing enough to understand it?'". While Elon Musk clowns around, investors should get back to basics with Bitcoin By David Moadel , InvestorPlace Contributor May 12, 2021, 4:15 pm EDT May 12, 2021 We're talking about really using a different form of currency to do transactions across the globe and over the past 12 months we've seen more CFOs willing to entertain the conversation. "If you are a big company that has large amounts of funds moving across borders, that's probably a pain point for you and you should probably be thinking about this," he said. ... they've got to get boards and investors and all parties thinking the same.". A woman named Julie Bushnell fell for the scam, after the fraudsters promised her double the sum in exchange of her cryptocurrency investment, as per a report on BBC. A vastly improved search engine helps you find the latest on companies, business leaders, and news more easily. Starting with climate. Even since Microstrategy, Square and Musk bought bitcoin for Tesla's balance sheet, more CFO clients have proactively come to Gartner asking for information they can use in discussions with their board, though not the majority of CFOs, and not in terms of making a pitch like Sackett's to his C-suite. MicroStrategy CEO Believes His Tweet To Elon Musk Led To Tesla's Bitcoin Investment. Some chief financial officers are digging into bitcoin more than others. Elon Musk surprised the cryptocurrency market by citing energy consumption in bitcoin mining as a reason to stop accepting payment for EVs in crypto while not selling Tesla's bitcoin. His warning for the executive class: if you don't take bitcoin and crypto seriously you will be making a mistake equivalent to telecom executives who ignored the internet in the 1990s and what it was going to do for information. —Elon Musk … Elon Musk. S&P Index data is the property of Chicago Mercantile Exchange Inc. and its licensors. If you mine it all from bituminous coal that's going to give you one level of carbon intensity, but if it comes from clean power it is a totally different footprint. Wences Casares, CEO of digital bank and bitcoin custodian Xapo, Bitcoin mining is incentivized to use renewable energy, CEO says. Martin Whittaker, CEO of ESG market specialist, JUST Capital, which focuses on holding companies accountable on issues like carbon emissions, said climate criticisms of bitcoin are easy to make, but can be oversimplified. "I think it will come down again, but go up in value even more," he said. BTC’s price fell below $40,000 earlier today for the first time since the EV maker announced its investment in the currency three months ago. Tesla CEO Elon Musk thinks digital currencies are here to stay. Elon Musk's Bitcoin Investment Supports Energy Waste, Some Critics Say Jon Jackson 2/8/2021. In Musk's defense, his comments on the energy intensity of mining were also a call to action for the crypto industry to focus on creating efficient operations — maybe with more control over the market for himself. "It's not just the CFO but the audit committee and board and treasury and finance, so much that needs to get around making this change or moving to it as a form of investment. Casares has recommended an allocation 1% of a portfolio to bitcoin for individuals. But Elon Musk’s emergence as a major backer of Bitcoin has complicated the picture. Tesla, Square, and Microstrategy have been corporate leaders in adding bitcoin to balance sheets; Palantir Technologies has said it may also. All Rights Reserved. Elon Musk’s Tesla recently invested US$1.5 billion in bitcoin and announced that the clean energy company intends to begin accepting the cryptocurrency as a form of payment. Casares says the market may not mature for a decade to two decades, but added, "I cannot imagine a Fortune 500 company having a CFO who does not understand it well, and early.". But most CFOs around the world, over 80%, also believe bitcoin is in a bubble and should not be accepted as a source of payment or held on the balance sheet. Tesla is widely considered to be the standard-bearer for the consumer electric vehicle industry and the broader climate tech movement rallying around it. "The board knows my position and I will bring more evidence why I believe this, and why it is a good decision.". The business intelligence company executive says that Tesla’s $1.5 billion investment in Bitcoin … For a hot Twitter moment on Sunday, the world thought Musk was insinuating that Tesla was in fact selling off or had sold its bitcoin, before he cleared up that confusion (for now at least) in a subsequent tweet.
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