Elon Musk Holds To His Bitcoin, But Why Tesla Sold 10% Of Its BTC?

Yesterday Tesla released its earnings report for Q1, 2021. In February, the company bought $1.5 billion in Bitcoin. Per the report, Tesla has sold at least 10% of its position for a $101 million profit.

Both the company and its CEO Elon Musk received severe criticism from the crypto community and others. DDTG Global owner Dave Portnoy accused Musk of “dumping” his BTC on investors to “make a fortune”. Tesla’s CEO replied to Portnoy and explain the reason for his company’s decision:

I have not sold any of my Bitcoin. Tesla sold 10% of its holdings essentially to prove liquidity of Bitcoin as an alternative to holding cash on balance sheet.

As reported by NewBTC, Tesla was probably trying to achieve a specific target for this Q1 and sold part of its BTC with that intent. Data provided by The New York Times shows that the car manufacturer has a quarterly profit of $438 million an all-time high for the company.

Also, Tesla made around $518 million with emissions credits to different companies. In comparison, last year the company made $164 million on this type of credit. In total, Tesla made over $1 billion during the first quarter of this year.

The company faces difficulties like the global shortage of computer chips said The New York Times report, and obstacles in its supply chain. However, Tesla’s CFO or Master of Coin, his official title, Zach Kirkhorn said their Bitcoin investment “has proven to be a good decision”.

Kirkhorn added that the company will continue to put some of its capital in BTC and grow its holdings vita its clients purchase with the cryptocurrency.

Bitcoin Was Key In Tesla’s Record Q1 Earnings

Reporter Clare Sebastian for CNN highlighted that Bitcoin was the “small print” in Tesla’s report. The profit for liquidating that small portion of their BTC holdings accounted for almost 25% of their profitability.

The company has a record of 7 quarters in profit, but now it faces the aforementioned crisis in its supply chain. Musk expects the chip shortage to continue until 2023, at least. Therefore, Bitcoin will most likely continue to be a central component in the company’s financial strategy.

Additional data provided by monitor Bitcoin Treasuries shows that Tesla, Inc still holds second place in the ranking of public traded companies that bought BTC. The Musk-led entity holds around 48,000 BTC or .229% of the cryptocurrency’s entire supply.

Bitcoin BTC BTCUSD
Tesla ranks second in terms of BTC holdings. Source: Bitcoin Treasuries

MicroStrategy sits at the top with 91,579 BTC or .436% of the supply. In total, $1,4 billion (6.78% of BTC total supply) is held by public traded companies.

Bitcoin is trading at $54.019 with a 2.7% profit in the daily chart. In the weekly and monthly chart, BTC is showing sideways movement.

Bitcoin BTC BTCUSD
BTC with small profits in the daily chart. Source: BTCUSD Tradingview

Share:

Share on facebook
Facebook
Share on twitter
Twitter
Share on pinterest
Pinterest
Share on linkedin
LinkedIn

Follow Us

Most Popular

Get The Latest Updates

Subscribe To Our Weekly Newsletter

No spam, notifications only about new products, updates.
On Key

Related Posts

Bitcoin above 20K AGAIN! Is Bitcoin Price Bullish Today?

The crypto market is moving still in a sideways trend. Trading cryptocurrencies is being favored by crypto enthusiasts rather than simply buying and holding. The reason for this is that consolidation phases are much more predictable thanks to technical analysis. Crypto traders are loving the current crypto dynamics in the market. After Bitcoin fell to

Breaking: Do Kwon Linked 3,313 Bitcoin To Be Seized? S. Korea Deepens Probe

Trouble for Do Kwon, Terra co-founder seems to be increasing after Interpol issued Red Notice against him. In the latest hit, South Korean authorities have moved on to deepen their probe against the alleged crypto fugitive. Do Kwon to lose his Bitcoins? According to reports, South Korean prosecutors are moving… Read more

Bitcoin Skyrockets As Stock Market Crashes, Is It Breaking Correlation

The crypto market is experiencing a surprise bounce. Bitcoin has rallied from the $18K-$19K range to cross the $20K mark. It has increased by over 5% in the last 24 hours and is currently trading at $20.1K.  However, since the stock markets are dumping, Bitcoin looks to break the correlation…. Read more

Bitcoin and Crypto Defy Wall Street Meltdown With Strong Rally

Wall Street started the week in a correction mode with all three top U.S. indices correcting 1% on Monday, September 26. However, Bitcoin and the broader crypto market have made a surprising move northwards with the BTC price shooting past $20,000 levels. With the recent BTC move, more than $14… Read more