Tesla sold 75% of its bitcoin a year after praising its ‘long-term potential’

Dave Harvard
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Tesla sold 75% of its bitcoin


  • In its second-quarter earnings report, Tesla said, “We have converted about 75% of our Bitcoin purchases into fiat currency.”
  • Last year, the company put $1.5 billion into bitcoin.
  • After a massive rise in value in 2021, the value of the digital currency has fallen a lot this year.

Investing on Bitcoin

Tesla put $1.5 billion into bitcoin at the beginning of last year, betting on what it called bitcoin’s “long-term potential.” Three-quarters of the company’s assets have already been sold.

“As of the end of Q2, we have converted approximately 75% of our Bitcoin purchases into fiat currency, “Wednesday, Tesla released its earnings report for the second quarter. The company said that these sales gave it $936 million in cash.

A drastic change in the situation

It’s a quick fall for Tesla and CEO Elon Musk, who was a big fan of cryptocurrencies during last year’s boom and often tweeted about them. In the last few months, bitcoin prices have dropped by half. This has been called a “crypto winter.”

Tesla’s bitcoin holdings were worth about $2.48 billion at the end of the first quarter of 2021 and about $2 billion at the end of the year. The company didn’t say how much it sold for or wrote off, but bitcoin started the second quarter at nearly $46,000 and ended below $19,000.

Analyst Brian Johnson at Barclays said earlier this week that Tesla would lose $460 million because of bitcoin due to the selloff.


“The reason we sold a bunch of our bitcoin holdings was that we were uncertain as to when the Covid lockdowns in China would alleviate so it was important for us to maximize our cash position,” Musk said in an earnings call on Wednesday. “This should be not taken as some verdict on bitcoin,” he said, adding that Tesla is open to increasing its crypto holdings in the future.

Musk was asked about bitcoin’s potential as a hedge against inflation on the earnings call. He said that Tesla’s primary goal is to speed up the switch to renewable energy and that bitcoin is “a sideshow to a sideshow.”

Tesla went big on bitcoin in the first quarter of 2021 to become more flexible, diversify, and increase cash returns. As the currency rose, the corporation sold 10% and made $101 million.

According to Kirkhorn, at the time that the company planned to “hold what we have for the long term and continue to collect Bitcoin from our customers as they buy vehicles.”

Musk said in May last year that Tesla would stop accepting bitcoin for car purchases because mining hurts the environment. Still, he also said that the company “will not be selling any bitcoin.” A week later, he tweeted emojis that said the company had “diamond hands” when investing in bitcoin. He credited “our master of coin.”

As we can see, a lot can change in a year.

Dave Harvard Author

Dave Harvard is a symbolic persona representing an individual whose talents and expertise rival those of a Harvard graduate. Embodying this character, VPNipedia proudly delivers top-notch, Harvard-quality articles for our discerning readers.

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