Due to a significant uptick in Tesla stock, a new narrative has emerged: TSLA is—apparently—the new bitcoin. But is there any truth to this?
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Tesla's parabolic rally is strikingly similar to bitcoin’s but equating the two assets is just plain wrong. | Image: JACK GUEZ / AFP
- Is there a bitcoin-Tesla connection?
- Are BTC and Tesla truly the world’s most “disruptive” technologies?
- Blockchain, not bitcoin.
Thanks to a significant uptick in Tesla (NASDAQ:TSLA) stock since the start of 2020, a new narrative has emerged: Tesla stock is—apparently—the new bitcoin. But is there any truth to this beyond a trivial analytic link?
—and its kinship to BTC—is being picked apart by nearly every analyst of late. One of the most recent speculators to highlight the quasi-relationship is Bloomberg Intelligence analyst Mike McGlone.
McGlone observed that Tesla’s stock price seems to be mimicking its 2013 performance—a year that witnessed TSLA explode from $32 to $190 in the space of nine months:
On the long-term chart, [TSLA] trades just like it did in 2013, which was one of the biggest years ever. And by the way, that was the biggest year ever for Bitcoin and it looks to me like you’re seeing a little bit of Bitcoin catching up.
Bitcoin and Tesla: “The world’s most significant disruptive technologies”
McGlone certainly isn’t alone in his thinking. A variety of crypto (and some non-crypto) commentators have also noted the TSLA-BTC connection. Crypto trader Scott Melker even suggested that :
You can’t blame people for drawing comparisons. TSLA has gone on a parabolic streak since late October, climbing from $254 to a peak of $887 in early February. That marks a massive 250% increase in a little over three months. Remind you of anything?
Given this integral turning point for Tesla, it’s understandable why many are making the bitcoin-Tesla connection.
According to McGlone, while the assets’ charts appear to be lining up, the primary correlation between the pair remains their “disruptive” nature:
They’re different assets but they’re the world’s most significant disruptive technologies with name recognition all around the world.
Tesla Still Has the Potential for Disruption
McGlone is right. Tesla is an undoubtedly innovative company. Its intention to supersede outmoded gas guzzlers makes it a highly relevant disruptor, especially in the age of environmental awareness.
Rather than cornering the market, as disruptive innovations typically do—often by producing a cheap and effective product—Tesla’s success has instead drawn in multiple competitors. For example, compared to the .
Nevertheless, there is unquestionably a demand for Tesla. Last year the firm managing to seize 16% of the electric vehicle market despite established competition.
As a world-renowned pioneer of the electric vehicle industry, Tesla’s demand will likely continue to grow.
Has Bitcoin Lost Its Disrupt Factor?
And then there’s bitcoin.
Once touted as the death knell for the traditional financial industry, bitcoin’s allure as a disruptor has all but dissipated in recent years. Despite being a pioneer of blockchain technology and digital payments, a deficiency in adoption has curbed bitcoin’s goal of financial dominance.
For the most part, Bitcoin losing its disruptor status arises from a trifecta of woes: regulation, innovation and categorization.
A lack of cohesive regulation has left BTC adoption staggered across multiple jurisdictions. In the U.S., while , the IRS defines bitcoin as “ and All of which contribute to the confusion.
Constant disagreement as to its use case has similarly buckled bitcoin—with no real consensus as to whether it’s, , or both. As a consequence, the markets have become saturated. The cryptocurrency markets are now chock-full of bitcoin derivatives, each touting a sounder use-case than the last—providing further dilution in bitcoin’s mission toward disruption.
Blockchain, Not Bitcoin
Perhaps most damning of all is the argument that blockchain is a better disruptor than bitcoin.
“Bitcoin, not blockchain” is an adage typically used by non-believers. to U.S., those who rank BTC lower than its underlying tech appear to be winning the debate.
Last April, . The list included big shots such as Amazon Web Services, BBVA (Spain’s second-largest bank), Citigroup and, of course, Facebook. All of which tend to turn a blind eye toward bitcoin itself.
At the end of it, despite what analysts say, bitcoin’s relationship with Tesla is negligible at best, and downright ridiculous at worst.
Disclaimer: The opinions expressed in this article do not necessarily reflect the views of CCN.com.
This article was edited by Sam Bourgi.
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