Tesla sold most of its BTC in the second quarter

Tesla Inc. sold a significant part of its holdings Bitcoin (BTC), an investment that helped legitimize the world's largest digital currency.

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Tesla has sold most of its BTC

„Ke konci druhého čtvrtletí jsme převedli přibližně 75 % našich BTC do fiat měny,“ uvedla Tesla ve středu v dopise pro akcionáře, který je součást zprávy o zisku společnosti. „Konverze ve 2. čtvrtletí přidaly do naší rozvahy 936 milionů dolarů v hotovosti.“

The electric car maker announced in February 2021 that it had invested $1.5 billion in Bitcoin and subsequently sold 10 % of its stake in April. Tesla said on Wednesday that the value of its digital assets had shrunk to $218 million, and the decline in the value of Bitcoin hurt second-quarter profitability.

Tesla CEO Elon Musk said on the earnings conference call that the company sold BTC to maximize its cash position due to uncertainty related to the Covid shutdowns. He noted that the sale should not be seen as some sort of verdict on BTC:

„Bylo pro nás důležité maximalizovat naši hotovostní pozici. Určitě jsme otevřeni v budoucnu zvyšovat naše držby BTC, takže by to nemělo být bráno jako nějaký verdikt nad Bitcoinem. Jde jen o to, že jsme měli obavy o celkovou likviditu společnosti.“

Musk has become a big supporter of cryptocurrencies. He has tweeted several times favorably about Dogecoin as a payment alternative and posted photos his dog Floki, who, like Dogecoin's mascot, is a Shiba Inu. When Tesla threw a massive party for its new Austin factory in April, the drone parade featured an image of Dogecoin.

Musk's support for Bitcoin helped serve as a catalyst for the digital currency after Tesla briefly adopted the token for purchases. The cryptocurrency hit a record high of nearly $69,000 in November. but later suspended the possibility of payment due to environmental concerns about its mining processes. Today's news marks the retreat of one of the most prominent bulls in the cryptocurrency sector during what is being dubbed the "cryptozyme."

Josh Olszewicz, head of research at crypto fund manager Valkyrie Investments, said rough estimates would place Tesla's BTC sale at a price level around $30,000, leaving $218 million in digital assets on the balance sheet.

“Strongly bearish market conditions since the beginning of the year, as well as the need for cash on the balance sheet, likely contributed to this decision. From a treasury management perspective, the downside volatility may have been too much to ignore in the near term,” Olszewicz said.  

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