Tesla has sold the majority of its bitcoin holdings. The electric car manufacturer founded by Elon Musk now holds only $218 million worth of the benchmark cryptocurrency — down from a whopping $1.2 billion.
In an after-market earnings report unveiled Wednesday, Tesla said it had liquidated 75% of its bitcoin holdings in the second quarter, adding $936 million to its balance sheet.
Tesla indicated that “bitcoin impairment” had a negative impact on its profitability. The EV giant sold BTC at an average price of approximately $29,000 per coin, dodging a considerable impairment charge by selling earlier in the quarter. As of June 30, the company owned just $218 million in BTC, down from around $1.26 billion in March.
The crypto market reacted immediately to the news of Tesla dumping.
Elon Musk averred during an earlier earnings call that Tesla had sold “a bunch” of its BTC holdings to increase its cash position, given the uncertainty around China’s lockdowns.
When asked by investors whether bitcoin is something he viewed as a long-term asset, Musk noted that the cryptocurrency was merely a “sideshow to the sideshow” as Tesla’s main goal is “to accelerate the advent of sustainable energy.”
Musk and Tesla have had a complicated relationship with bitcoin. The Tesla boss started evangelizing bitcoin seriously when he added the cryptocurrency to his Twitter bio in January 2021. Days later, Tesla announced it would accept bitcoin as payment for its cars after scooping up $1.5 billion worth of the top cryptocurrency.
Then in May last year, Musk made a u-turn on bitcoin as he revealed that Tesla would no longer accept it for payments owing to concerns about the energy expenditure of BTC mining.
Musk clarified this week that the sale wasn’t a verdict on bitcoin, and Tesla is “certainly open to increasing [its] Bitcoin holdings in the future,” adding that the company had not sold any of its Dogecoin (DOGE) holdings.
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