Elon Musk is taking a big gamble with his bitcoin bet

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Over the weekend the price of a bitcoin got within a hair’s breadth of $US50,000 ($64,380). In less than a week, thanks largely to Elon Musk, it has risen almost 30 per cent.It was Musk’s announcement a week ago that Tesla had used $US1.5 billion of its spare cash to buy bitcoins that set the price alight, soaring from $US38,461 to the record $US49,716 price at which it peaked on Sunday. It subsequently slipped back to $US48,949.Tesla’s explanation for the plunge into the cryptocurrency was that it had updated its investment policy to provide it with more flexibility to diversify and to maximise the returns on cash that wasn’t required to maintain adequate operating liquidity.It was predictable that the announcement would trigger a big move in bitcoin’s price and in the value of other cryptocurrencies – Musk has a lot of followers who hang on and respond to his every…

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