Tesla lost about $204 million on its Bitcoin assets in 2022, but made over $64 million while trading bitcoin. All in all, Tesla had a net loss of $140 million from having Bitcoin as an asset.
The year 2022 was not the year for Bitcoins or any other cryptocurrency for that matter. Ask Tesla, it surely knows. According to regulatory documents, Tesla declared a $204 million impairment loss on its bitcoin assets in 2022.
The loss was offset by $64 million in bitcoin trading earnings, resulting in a net loss of $140 million for the manufacturer.
Tesla invested $1.5 billion in bitcoin during the first quarter of 2021, which means that it trusted the cryptocurrency’s long-term viability.
At the time, the business stated that bitcoin was a wonderful location to keep cash while still having instant access to it, while also delivering a greater return on investment than more traditional central banks.
In fact, after its initial purchase, Tesla promptly trimmed its position by 10 per cent, making the automaker a quick $101 million.
Tesla CEO Elon Musk said in March 2021 that the company will begin accepting bitcoin as payment for Tesla automobiles, leading the cryptocurrency’s price to skyrocket.
A few weeks later, Musk and Tesla reversed their decision, citing concerns about the amount of energy required to mine bitcoin. The price of bitcoin then plummeted.
As the value of bitcoin began to fall last year, Tesla liquidated 75 per cent of its bitcoin assets and used the profits to purchase regular money.
The carmaker now holds around $184 million in bitcoin and maybe hoping Bitcoin and other cryptos to bounce back.
Over the last year, the cryptocurrency market has witnessed a severe decline. Despite dropping more than half its value, some analysts believe bitcoin has remained durable and may make a comeback, particularly when consumers frightened by the crypto market, in general, migrate for household brands and more established ecosystems, such as bitcoin or ether.
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