Tesla is facing more scrutiny on its $1.5 billion purchase of Bitcoin. According to reports, Tesla’s board of directors approved the company’s bitcoin purchases. He is a cryptocurrency investor and a board member of two major crypto companies.

Experts question Tesla’s conflict of interest in buying Bitcoin

The Telegraph reported on Tuesday that as experts now question whether there is a conflict of interest around the directors who approved the company’s large bitcoin purchases, Tesla’s purchase of its bitcoins has been further scrutinized. Tesla recently revealed that it purchased $1.5 billion worth of Bitcoin in January and plans to accept this cryptocurrency as a payment method for its products in the near future.

The publication described that when Tesla’s directors approved the company’s bitcoin purchases, crypto investors who had connections with the two crypto companies also appeared, resulting in a conflict of interest. Antonio Gracias is listed as an independent director on Tesla’s website and is a member of the audit committee that signed Tesla’s bitcoin transaction. He is a long-term friend of Musk. He invested in Tesla in 2005 and has been a member of Tesla’s board of directors since 2007.

Gracias is also the founder, CEO and chief investment officer of Valor Equity Partners, an investment company that has invested in two crypto companies. The first company is Bitgo, a cryptocurrency custody service provider, and the other is Erisx, a cryptocurrency derivatives trading platform. He is still sitting on their board. The publication added that Gracias was previously an investor in the tokenization platform Harbor, another crypto company acquired by Bitgo last year. The news media conveyed:

Corporate governance experts say that the common role creates a potential conflict of interest, which means he should back down.

Charles Elson, a professor of finance at the University of Delaware, said: “Prudging with caution will recommend withdrawal in this situation.”

See also  $1.4 million in Bitcoin is still idle-a strange case of block rewards in 2009 37 days a year ago-Bitcoin Featured News

Bill Klepper, a professor of management at Columbia University School of Business, explained: “If there is any direct conflict or appearance, it’s best to keep a distance from it. The right thing to do is to seek legal counsel. We don’t know. Did he do it?” He further thought:

We must find out whether he acted in good faith. Because of the lack of transparency, you will find that people start to question your ethics.

The news media added that Gracias is also a member of the board of Musk Rocket Company Spacex and pointed out that he will resign from Tesla this year.

Recently, lawyers warned that the U.S. Securities and Exchange Commission (SEC) may investigate Tesla CEO Elon Musk over the issue of Bitcoin purchases by electric vehicle companies. At the same time, as the price of BTC rose from around US$30,000 in January to the level of US$40,000, at the time of writing this article, Tesla’s Bitcoin price has risen sharply.

Do you think Tesla has a conflict of interest in buying Bitcoin? Let us know in the comments section below.

Picture Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for reference only. It is not a direct offer or solicitation of an offer, nor is it a recommendation or endorsement of any product, service or company. Bitcoin.com does not provide investment, tax, legal or accounting advice. The company or the author is not directly or indirectly responsible for any damage or loss caused or allegedly caused by the use or reliance on any content, goods or services mentioned in this article or related thereto.

See also  Samsung Galaxy S20, Galaxy Note 20 get dedicated apps to enhance game performance