Tesla Rakes in $64 Million in Bitcoin Sales in Q2
- Tesla made huge investments in Bitcoin in 2021 Q1, but the recent decline in price has led to a sell-off.
Electric car company, Tesla, reportedly made $64 million in profits from the sale of its bitcoin holdings in Q2. The Elon Musk-led firm decided to offload some of its investment in bitcoin as the digital asset plunged to an all-time low. Tesla reportedly sold 75% of its BTC holdings in Q2.
According to an official Form 10-Q filing with the United States Securities and Exchange Commission, Tesla incurred $170 million in impairment losses, which it said were caused by changes to the carrying value of its Bitcoin holdings.
Tesla bought its first bitcoins in Q1 of 2021 for $1.5 billion. However, the firm did not publicize the average price paid. Tesla later confirmed that it had sold 10% of its holdings in bitcoin during that same first quarter, increasing its earnings by $272 million.
Tesla reportedly had per-share earnings of $2.27 during 2022 Q2 with a revenue of $16.93 billion. This figure was a decline from the profit recorded in Q1 but was a huge upgrade from this time last year. Unfortunately, escalating inflation and intensifying competition for battery cells had an influence on Tesla’s profitability.
Despite the profits recorded from its BTC sales, Tesla reportedly has about 10,800 BTC. The company’s digital asset holdings are currently valued at about $22,000 BTC, or around $237 million. The car manufacturer has maintained a positive outlook on digital assets, but overall market conditions would determine how the firm would relate to cryptocurrencies.
Tesla’s CEO, Elon Musk, has a history of being a vocal proponent of cryptocurrencies. His predictions on the use of cryptocurrencies often affected Dogecoin and bitcoin’s prices. Musk’s support for digital assets prompted a backlash from his detractors, as prices fell to new lows in Q2.
In his defense, Musk claimed his support for cryptocurrencies was not financial advice. The SpaceX CEO said in an interview with Bloomberg,
I have never said that people should invest in crypto. I intend to personally support dogecoin because I just know a lot of people who are not that wealthy who have encouraged me to buy and support dogecoin, so I’m responding to those people
It remains to be seen if Musk’s Tesla would make more investments in Bitcoin if the digital asset were to regain its fame. Many bitcoin holders are optimistic that the foremost cryptocurrency will surge again in its price. However, no one knows the exact time that will happen.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
