Tesla’s stock is now closely linked to the price of digital gold, according to Wedbush Securities.
“Tesla is entering the golden age of electric vehicles, and there are concerns that small bets on bitcoin could eclipse the company’s growth story in 2021,” the strategists wrote in a new note.
Wedbush analysts linked the drop in the electric-car maker’s shares to $621 with mass liquidations and a decline in Bitcoin’s price to $45,000. According to Yahoo Finance, Tesla stock (TSLA) was trading at $698 at the time of writing.
Chart of Tesla stock decline (TSLA). Data: Yahoo Finance.
On February 8, Tesla reported that invested $1.5 billion in Bitcoin, after which the asset’s price began to rise sharply. The automaker’s shares moved in the opposite direction to the price of the leading cryptocurrency.
On February 19, Elon Musk described Tesla’s investment in the leading cryptocurrency as “quite risky”. The billionaire hinted that it was not his decision.
Tesla’s unrealized gains from holdings in digital gold were higher than those from selling electric vehicles in 2020.
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