Tesla, Inc.

1. Strategic Investment and Asset Allocation: Tesla invested $1.5 billion in Bitcoin at the beginning of 2021, using it as an alternative asset allocation aimed at diversifying cash reserves and maximizing returns. Although it later sold most of its Bitcoin, the act of holding Bitcoin itself constituted a business model in the cryptocurrency market, which is to manage company assets by holding cryptocurrencies.
2. Cryptocurrency payment acceptance: • Bitcoin Payment (Paused): Tesla briefly accepted Bitcoin as a payment method for its automotive products. This move aimed to enhance the practicality and mainstream acceptance of Bitcoin, while also providing Tesla's customers with more payment options. However, due to concerns over the energy consumption of cryptocurrency mining, Tesla has paused accepting Bitcoin payments for cars. • Dogecoin Payment (Products): Tesla currently accepts Dogecoin as a payment method for some of its products. This indicates Tesla's open attitude towards the practicality of certain cryptocurrencies and uses it as a marketing strategy and a way to engage with customers.

Tesla's profit model in the cryptocurrency market mainly comes from the value fluctuations of its Bitcoin investments and accounting treatment:

1. Bitcoin Investment Returns: Tesla expects to gain capital appreciation from the rise in Bitcoin prices by purchasing and holding Bitcoin. For example, recent reports indicate that new accounting standards allow Tesla to report unrealized gains on its Bitcoin holdings, thereby enhancing the company's book profits.
2. The impact of changes in accounting standards: With the changes in cryptocurrency accounting standards (for example, the new regulations from the Financial Accounting Standards Board, FASB), companies can report cryptocurrency assets at fair value, allowing the value fluctuations of cryptocurrencies like Bitcoin to be directly reflected in the company's financial statements, thereby affecting its reported profitability. When the price of Bitcoin rises, the value of Tesla's cryptocurrency holdings increases, potentially resulting in paper profits.

The role and significance of Tesla's cryptocurrency profit model lie in:

1. Asset Diversification and Value Preservation: By allocating a portion of its cash reserves to cryptocurrencies such as Bitcoin, Tesla seeks to diversify its assets beyond traditional financial assets and hopes to preserve and increase the value of its assets in an inflationary environment.
2. Market Signals and Industry Influence: As a globally renowned innovative company, Tesla's investment in and acceptance of cryptocurrency has sent a strong signal to the market, promoting the mainstreaming of cryptocurrency and potentially encouraging other companies to follow suit, thereby having a positive impact on the entire cryptocurrency market.
3. Innovation and Brand Image: Accepting cryptocurrency payments and making strategic investments in cryptocurrencies align with Tesla's brand image as a technology-driven and future-oriented company, attracting customers and investors interested in new technologies and decentralized finance.
4. Financial Report Optimization: The new accounting standards enable companies to more accurately reflect the true value of their cryptocurrency assets, which helps enhance the transparency of financial reports and may lead to positive financial performance for companies during market upswings.

Tesla's impact on the cryptocurrency market is mainly reflected in the following two currencies:

1. Bitcoin ( Bitcoin - BTC ): • Price Volatility: In early 2021, Tesla announced the purchase of $1.5 billion in Bitcoin and planned to accept Bitcoin payments, which greatly boosted market confidence and drove Bitcoin prices to an all-time high. However, Elon Musk's subsequent suspension of Bitcoin payments citing environmental concerns, along with Tesla's sale of a portion of its Bitcoin holdings, also led to significant fluctuations in Bitcoin prices. This indicates that Tesla (especially Elon Musk's words and actions) has a significant influence on market sentiment and Bitcoin prices. • Institutional Acceptance: Tesla, as a large publicly traded company, has invested in Bitcoin, setting an example for other companies to enter the cryptocurrency market, enhancing the legitimacy of Bitcoin as a corporate asset allocation and institutional acceptance. •Impact of Accounting Standards: The new accounting standards allow companies to report cryptocurrency assets at fair value, causing the value changes of Tesla's Bitcoin holdings to directly affect its financial statements, thereby indirectly influencing the market's perception of cryptocurrencies.
2. Dogecoin (Dogecoin - DOGE): • Price speculation and volatility: Elon Musk has repeatedly mentioned Dogecoin on social media and announced that Tesla accepts Dogecoin as payment for goods, which has led to significant fluctuations in Dogecoin's price, attracting a large number of retail investors. His statements are considered one of the main driving forces behind the rise in Dogecoin's price. •Improved practicality: Accepting Dogecoin for goods has, to some extent, enhanced the actual application scenarios and visibility of Dogecoin, transforming it from a "meme coin" into a cryptocurrency with certain practical uses.