Buy $100 worth of crypto and get a bonus $10

  • Trade crypto and digital assets
  • Significant sign-up bonuses
  • The most trusted finance platform

Disclaimer: eToro USA LLC; Investments are subject to market risk, including the possible loss of principal. Your capital is at risk. This ad promotes virtual cryptocurrency investing within the EU (by eToro Europe Ltd. and eToro UK Ltd.) &USA (by eToro USA LLC) which is highly volatile, unregulated in most EU countries, no EU protections & not supervised by the EU regulatory framework. Investments are subject to market risk, including the loss of principal.

  • Home
  • >News
  • >Breaking: Tesla Sells 75% of Its Bitcoin, But Open to Buying More in the Future

Breaking: Tesla Sells 75% of Its Bitcoin, But Open to Buying More in the Future

Tesla has sold 75% of its bitcoin holdings, according to its financial report for the second quarter of the year. The sale provided the EV manufacturer’s balance sheet with $936 million in fiat currency, yet it likely represents a loss for the firm, which originally bought its bitcoin at a price of around $32,200 in February 2021.

The sale also represented a loss for bitcoin, which reacted to Tesla’s latest disclosure by falling from roughly $23,600 to $22,724. Its price currently sits just under $23,000, meaning that Tesla’s firesale hasn’t really derailed the modest recovery in prices witnessed over the past few days. At the same time, Musk has admitted that the sale isn’t really about bitcoin, and that Tesla is open to acquiring more of the cryptocurrency in the future.

Will Elon Musk add crypto to Twitter?

Tesla Sells Bitcoin Amid Tough Times

Tesla has been having a rough patch as of late. At 766.98, its stock price has fallen by 33% in the year to date, and by 37.6% since an all-time high of 1,229 in November.

To make matters worse, the manufacturer also recorded a 31.9% decline in net income between Q1 and Q2 2022, from $3.318 billion to $2.259 billion.

This follows remarks from CEO Elon Musk, who in June was reported as saying he has a “super bad feeling” about the US and global economy. These remarks were taken from internal Tesla emails, in which Musk also discussed reducing the company’s headcount by around 10%.

Twitter and Bullishness

There’s also the fact that Musk is currently being sued by Twitter, with a Delaware judge recently decreeing that the trial between the two parties shall begin in October. Twitter is claiming that Musk is trying to finagle his way out of a legally binding contract to purchase the social media company for $44 billion, a price which valued the firm’s shares at $54.20. Now, Twitter’s stock stands at $39.60, meaning that Musk will be paying well over the odds if he is forced to proceed with the purchase.

Interestingly, there’s a chance Musk could walk away from the deal by paying a fine of $1 billion. This figure seems eerily close to the amount of money Tesla received for selling its BTC.

Regardless, all of the above suggests that Tesla’s sale of its bitcoin is more of a reflection on the car manufacturer than it is on Bitcoin or crypto. In fact, Musk admitted just as much in a conference call with analysts yesterday:

“We are certainly open to increasing our Bitcoin holdings in future, so this should not be taken as some verdict on Bitcoin. It’s just that we were concerned about overall liquidity for the company, given COVID shutdowns in China. And we have not sold any of our Dogecoin.”

The price of BTC is still up by 13.5% in the past week, while the total cap of the entire cryptocurrency market is also up by basically the same percentage, at $1.068 trillion.

Many members of the cryptocurrency ‘community’ have argued that the news of Tesla’s sale is more or less bullish for Bitcoin. Reasons given include the fact that Tesla’s bitcoin has now (mostly) gone to “more reliable and less erratic actors,” and that the sale proves that the cryptocurrency is liquid enough to be bought and sold in large quantities without crippling its price.

Source: Twitter

Looking at the picture, it seems that Bitcoin and crypto will easily survive to live another day. As for Tesla, it remains the world’s biggest car manufacturer by market capitalization, but it possibly has some bumpy road left to navigate.

Article Tags
CryptoVantage Author Simon Chandler

About the Author

Simon Chandler

Simon Chandler is a journalist based in London. He writes about technology, markets and politics, and has bylines for Forbes, Digital Trends, CCN, Wired, TechCrunch, the Verge, the Sun, the New Internationalist, and TruthOut, among many others. His Twitter handle is @_simonchandler_

Back To Top