Tesla has been forced to sell almost 75% of its Bitcoin holdings only 18 months after spending over $1 billion on the digital currency, in what looks to be a last-minute scramble to keep its finances in order.
On Wednesday, Tesla said that it has sold 75% of its bitcoin stash, according to an earnings report. In the second quarter of this year, the business sold $936 million worth of Bitcoin.
As of June 30, Tesla has just 42,000 BTC on hand. If the corporation sold 75% of its BTC for $936 million, then each BTC was sold for an average of $29,000. It seems Tesla sold the assets before the crypto winter, which saw Bitcoin fall to a low of $18,000, according to these numbers.
On June 30, Tesla’s operational income was $2.5 billion, and CEO Elon Musk said that “Bitcoin’s impairment” had harmed the company’s profitability. We had to sell assets to get our books in order, which resulted in a cash infusion of $936 million.
Despite the allegations, BTC has remained over the $20k level and is now trading at $22,867.
Following the results call, a positive surge of enthusiasm swept over Tesla’s shares, which completed the day in the green.
An outcry broke out in the ecosystem when the decision was made to sell for reasons unrelated to bitcoin. Thus, according to DonAlt, “Elon Musk is okay hawking DOGE to the people, but is not comfortable retaining BTC and sells for a (rumored) 10% loss after a complete round trip.”
After buying $1.5 billion worth of Bitcoin in February 2021 to add to its balance sheet, Tesla generated quite a commotion. As a result, the price of Bitcoin surged and a revolutionary announcement was made that consumers could now pay for automobiles using the cryptocurrency.
Tesla reversed course and stopped accepting Bitcoin payments for car purchases, so the honeymoon was short-lived. As Musk put it, “the exponential increase in fossil fuels for Bitcoin mining and transactions” prompted the decision.
He stated that the firm would not sell any of its bitcoins and will continue to accept the currency as a form of payment when mining operations employ renewable energy.
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