technoking

Currency of the future or tulip bulb of the past: will crypto continue to boom or will it bust?

Business

Michael D’Angelo, Staff

Gadgets 360

Pictured above is Tesla CEO, Elon Musk. In late March, Musk announced via Twitter that Tesla cars may be bought with bitcoin and any bitcoin Tesla receives as revenue will not be converted to fiat currency.

All the recent rage in the financial markets is related to cryptocurrency. It appears almost daily one can see a crypto-related news headline. Just two weeks ago a “meme” cryptocurrency known as dogecoin reached an all-time high, netting some traders thousands of dollars. In addition, just yesterday, Tesla announced they sold $272 million worth of bitcoin (BTC) during the first quarter. 

Cryptocurrency is defined as an unregulated digital currency that uses an online ledger to track ownership to buy and sell goods. An idea of unregulated digital currency drives the enthusiasm behind crypto and many investors view the currency as digital cash that cannot be traced. The most popular cryptocurrency is Bitcoin. Bitcoin utilizes complex blockchain technology to track ownership and manage trading. Some investors see Bitcoin as a store of value and an alternative to physical gold while others view it solely as currency to buy and sell goods. 

Bitcoin has grown tremendously since its inception in 2009 and has experienced widespread interest since last March when the pandemic and stay-at-home orders forced millions into lockdown. Much of Bitcoin’s rise is attributed to retail investors, but institutional investors are involved with the commodity. Big-name financial companies and fintech players like Square and MicroStrategy have used cash to purchase bitcoin. Even asset management fund Fidelity has jumped in and intends to release an ETF to track BTC benchmarks. Bitcoin’s market cap is currently valued at over $1 trillion. 

Tesla’s CEO, Elon Musk, has spoken countless times about cryptocurrency and his company’s offer to accept Bitcoin as payment for their cars. In February of 2021, Tesla bought $1.5 billion of Bitcoin. They stated in SEC filings that the purpose of the purchase was to gain a better return on their cash, but they did warn investors of the price volatility involved with the purchase. According to Tesla’s Q1 earnings report, total revenue grew year-over-year by 74 percent. Tesla’s GAAP net income reached $438 million while non-GAAP net income was over $1 billion. Also, Tesla reported more deliveries of their car products. Musk made the Bitcoin purchase to emphasize the liquidity involved with the coin. 

As cryptocurrency becomes more widespread, regulators and government officials are left scratching their heads. They must decide how to regulate the crypto market. India had a ban on cryptocurrency which has been reversed in March of this year. Turkey has banned cryptocurrency. Back home in the United States, Bitcoin faces some regulation by organizations like the SEC, the Fed and the CFTC. The IRS taxes Bitcoin and other cryptocurrencies as property. Janet Yellen, the current Treasury Secretary, believes Bitcoin is an “extremely inefficient” way to conduct monetary transactions. Overall, many regulators are going to have to find an agreement and decide how to regulate the coin. 

As Bitcoin grows in popularity and many people look to the future, we must be cautious of the recent rapid rise in its price and remember the history of financial booms and busts. Bitcoin and the cryptocurrency market have the potential to fully take over our lives. Bitcoin can be as useful as the American dollar in the next few decades or can be remembered like the tulip bulb of 1637.

How the “Technoking of Tesla” is embracing meme culture

Business

Elizabeth McLaughlin, Staff

Getty Images

Tesla officially changed Elon Musk’s title of CEO to “Technoking of Tesla” in an 8-K filing with the Securities and Exchange Commission. Tesla’s CFO, Zach Kirkhorn, is now effectively “Master of Coin” according to the filing as well.

It’s 2050. An elementary school teacher is asking their students what they want to be when they grow up. Some kids want to be rockstars, others are medical school bound and one child replies, “I want to be Technoking.” Thanks to Elon Musk, that kid’s dreams just might come true some day.

On Monday, Mar. 15, the Tesla Inc. co-founder and CEO took on a new title: “Technoking of Tesla.” In a report filed with the Securities and Exchange Commission, Musk provided little explanation of the name switch; he also formally changed the title of Tesla’s chief financial officer, Zack Kirkhorn, to “Master of Coin.” Kirkhorn’s new title is a reference to a Game of Thrones character.

This apparently inconsequential change to Tesla Inc. has already prompted others to reevaluate their C-suite names. Siqi Chen declared himself the technoking of Runway Financial Inc., a financial startup that provides support and advice to struggling businesses. Runway Financial’s website is ripe with emojis, denoting a marked shift from the traditional stuffy environment of, for example, Charles Schwab. Runway Financial promises to deliver “something that fundamentally rethinks the role of financial data;” their CEO’s — or, rather, technoking’s — decision to change C-suite titles indicates that they are, on some level, fundamentally rethinking the traditional structure and formality of business hierarchy. Mr. Chen told The Wall Street Journal that “all titles are jokes, and it’s tribute to our Technoking Musk for making this clear to the SEC.”

There is no question that Musk is a trendsetter. But his decision to change the traditional C-suite titles to names that embrace meme culture could be reactionary to the rise in importance of retail investors as of late. Recall what happened with GME in late January 2021: Redditors drove the stock price up, causing Wall Street investors to hemorrhage money and re-evaluate their positions. It is clear that retail investors possess the power to influence markets in unprecedented ways. Given the fact that they are making their trades online, largely based on the advice of fellow netizens, perhaps Musk is simply catering to their culture.

Moreover, Tesla purchased $1.5 billion in Bitcoin this year. They are not only embracing the convergence of Internet and finance through trivial name changes, they are also literally investing in this new future of finance. It is clear that Musk is paying attention to the emerging influence of Internet culture on finance; perhaps Tesla will implement some more radical changes than technoking in the near future.

mclaughline7@lasalle.edu