Electronic vehicle maker Tesla Motors is officially more valuable than Bitcoin. On July 2, 2020, the price for one share in the company was $1,208.66, giving the company a total market capitalization of over $224.1 billion. That’s an astronomical figure for a company that still losing money on its balance sheet, it clearly investors are hoping the future promise of Tesla revolutionizing driving as we know it will make the company worth much more than it is today.
Bitcoin investors do the same thing with cryptocurrency. Assuming the price for one Bitcoin is $9,000, the market capitalization sits at around $168 billion. At its all-time high of nearly $20,000 USD, Bitcoin’s market capitalization side at $334 billion. With both Bitcoin and Tesla intent on changing the world through revolutionary implementations of technology, investors and one have likely taken a look at the other.
Technology stocks and cryptocurrencies have been quite a good gamble over the last decade or so. It’s only natural for gamblers investing in one or the other (or both for that matter) to ask themselves, which is the better gamble? Bitcoin or Tesla?
Why Tesla is More Valuable than Bitcoin Right Now?
Tesla’s most recent quarterly reports are informing the public the company sold 90,635 cars in the previous quarter. That’s actually not a high number in comparison to larger automakers like Toyota but the point is that the number of cars sold vastly surpassed the expectations of Wall Street analysts.
Overall, under the leadership of Elon Musk, investors have been bullish on Tesla for just as long if not longer than they have been on Bitcoin. One of the key advantages that Tesla has is that Tesla cars have an immediate utility that consumers can count on right now. That utility is the ability to drive a car without using gas, which saves the consumer money. It also speaks to the fact that more and more Tesla cars are being purchased with automation features, meaning people no longer have to do the driving.
While Bitcoin certainly has utility as a peer-to-peer payment system, it’s still not at the level of most national currencies in terms of ease of use or adoption by the public or by businesses small, medium and large.
What Will It Take for Bitcoin to Get Ahead?
Increasing adoption and utility on a day-to-day basis from a consumer standpoint is what it will take for Bitcoin to surpass Tesla. Ideally, entire nations of people will decide to pull away from the government, or the world will need to see governments and large corporations adopt Bitcoin on a larger scale in order for the market value to permanently stay ahead of Tesla.
The reality is Bitcoin has a lot of hurdles to cross in order to get to that level. It may even take for an entire generation of people to accept Bitcoin as a valid form of currency in order for digital gold to be worth more than a company like Tesla Motors. Two things that separate Tesla motors and Elon Musk for Bitcoin is that Musk has authority over the future of the company and the general public trusts his ideas. Bitcoin relies in a community of people to share and implement ideas that scale the blockchain and make it more viable to use crypto in the long run.
Bitcoin or Tesla? Which One Should Gamblers Bet On Right Now?
Truth be told, it’s likely that neither Tesla nor Bitcoin are a good gamble in the short term. Governments are spending more and more money on stimulus packages to take care of the general public and the coronavirus pandemic is still running wild across the United States. Something has got to give and when the economy eventually takes a big downturn, few people are going to be throwing money into Bitcoin or buying expensive Tesla’s. The first wave of the pandemic in March 2020 counts as proof. The price of Bitcoin dips down to $3,100 USD as people panicked.
Long-term, Bitcoin may have more potential as far as exploding is concerned but it’s likely that investors who win betting on Bitcoin over Tesla have a more than 10 year investment horizon. Over the next decade, Tesla is probably the more stable gamble guaranteed to earn investors a profit, but Bitcoin may have the higher upside. Either way, investing in technology should always be a part of a well balanced portfolio. Whether you choose Bitcoin or Tesla really comes down to your own analysis.