Tesla customers can now buy their car with Bitcoin, company chief Elon Musk has said. Mr. Musk, a well-known Bitcoin enthusiast, made the unexpected announcement in a tweet. But Bitcoin’s value rapidly moves up and down – meaning the cryptocurrency price of the car could change day to day. Tesla has invested heavily in the digital currency, buying $1.5bn (£1.1bn) worth of Bitcoin. And that apparent vote in confidence saw Bitcoin’s value shoot to a record high.
Wednesday’s announcement also led to a modest bump in the price of Bitcoin. Mr. Musk tweeted Tesla would be running its own internal software to handle Bitcoin payments, which “operates Bitcoin nodes directly”. Nodes, in this sense, are the computers that process Bitcoin transactions. And in an apparent bid to assuage fears of Bitcoin enthusiasts who want to see the ecosystem thrive, Mr. Musk said: “Bitcoin paid to Tesla will be retained as Bitcoin, not converted to fiat currency”.
In the US, orders for new Tesla cars can now be secured with the equivalent of a $100 deposit in Bitcoin.
The facility would be rolled out to other countries in the coming months, Mr Musk said.
Bitcoin’s volatile price makes its use to buy real-world goods somewhat complicated.
For example, Tesla’s terms and conditions say if a refund is needed, it can pay in either the exact amount of Bitcoin paid or in US dollars based on the dollar price of the car – whichever it wants.
So if the price of Bitcoin shoots up before a refund is issued, the customer could lose out.