Bitcoin (BTCUSD) may have received its biggest backer yet. Electric car maker Tesla, Inc. (TSLA) has invested $1.5 billion in Bitcoin and will soon begin accepting payments for its cars in Bitcoin “subject to applicable laws and initially on a limited basis,” according to its filing with the Securities and Exchange Commission (SEC). The company stated that the purchase was made after a change in investment policy last month that allowed “more flexibility to further diversify and maximize returns” on cash not required for operations. The Palo Alto, California-based outfit had $19.38 billion in cash and cash equivalents on its books at the end of 2020.

Tesla is the first S&P 500 company to invest in Bitcoin and joins a growing list of corporates leveraging the cryptocurrency’s volatility for returns. Payments company Square, Inc. (SQ) bought 4,709 Bitcoins at an aggregate purchase price of $50 million, amounting to 1% of the total assets on its balance sheet, last October. Business intelligence platform MicroStrategy Incorporated (MSTR) put $1.3 billion of its cash holdings into Bitcoin last year as part of a change in its treasury management policy. The move, which some commentators criticized, helped pump MicroStrategy’s stock price to new highs despite no material changes to its business circumstances.

Fueled by interest from corporate and retail investors searching for returns during a time of macroeconomic stability, Bitcoin price set new records and jumped by more than 160% in 2020. Tesla’s announcement this morning propelled the cryptocurrency to a new record, and it almost touched $44,000. As of this writing, Bitcoin was changing hands at $43,578, up 13.40% from a day earlier.

The volatility of cryptocurrency markets works both ways, however. Even as Bitcoin price swings generate profitable returns in a short period of time, they can also crash valuations quickly. To that extent, Tesla’s investment can be construed as a safe play since it represents less than 1% of the $52.1 billion of total assets on its balance sheet at the end of 2020. In its 10-K filing, the company has also stated that it “may or may not” liquidate Bitcoin received as payment, meaning that it may be building up a Bitcoin liquidity stash for a rainy day.

A CEO Bullish on Bitcoin

While Tesla’s investment in Bitcoin may be a rounding error on its balance sheet, the company’s CEO is bullish on the cryptocurrency’s future. Tesla CEO Elon Musk, the world’s richest person, has frequently tweeted about Bitcoin and cryptocurrency markets in the past couple of years. For example, his Twitter query to MicroStrategy CEO Michael Saylor last December about “large transactions” involving balance sheet conversion to Bitcoin spiked the crypto’s prices. Earlier this year, Musk also changed his Twitter bio to #bitcoin.

During an interview on recently launched social media app Clubhouse last month, Musk said that he was “late to the [Bitcoin] party.” The CEO continued, “I do at this point think Bitcoin is a good thing, and I am a supporter of Bitcoin,” adding that the cryptocurrency was “on the verge of getting broad acceptance by conventional finance people.”

Musk’s tweets are also responsible for driving up prices of Dogecoin (DOGEUSD), a joke cryptocurrency designed as a tribute to Bitcoin, this month. In his Clubhouse interview, Musk clarified that he did not have a “strong opinion” on other virtual currencies.