Tesla converted about 75% of its bitcoins into fiat currency. The sale of the cryptocurrency resulted in the electric car company holding $218 million worth of digital assets.” We are certainly open to increasing our bitcoin holdings in the future,” said Tesla CEO Elon Musk, adding, “.” W e have not sold any of our dogecoin.”
Tesla Sold About 75% of Its Bitcoin Holdings
Tesla, Elon Musk’s electric car company, released its second quarter earnings report on Wednesday. The company wrote:
At the end of the second quarter, we converted approximately 75% of our bitcoin purchases into Fiat currency. The second quarter conversion added $936 million in cash to our balance sheet.
Tesla’s second quarter balance sheet shows net digital assets of $218 million, down from $1.26 billion in the previous quarter. The company also said its second-quarter year-over-year operating income was impacted by the Bitcoin impairment.
The electric car company’s cash flow statement shows proceeds from the sale of $936 million in digital assets. Only in the first quarter of 2021 did Tesla’s cash flow statement show sales of digital assets. At that time, sales were $272 million.
Tesla purchased $1.5 billion worth of bitcoin in early 2021 and has not purchased any since. The electric car company has never disclosed the number ofBTCit owns. However, Musk hinted last July that Tesla owns about 42K bitcoins.
The company also temporarily acceptedBTCas payment; it used BTCas payment but stopped last May, citing environmental concerns. Last October, Tesla told the SEC that it may resume accepting cryptocurrencies. Musk later said that Tesla would resume accepting bitcoin “when reasonable (about 50%) clean energy use by miners is confirmed and future trends are positive.” At the time of writing, however, Tesla has not resumed acceptance ofBTC.
Elon Musk: Tesla Has Not Sold Dogecoin and Is ‘Certainly Open to Increasing Our Bitcoin Holdings in the Future’
Musk explained in a call with analysts on Wednesday why Tesla sold most of itsBTC
“I should mention that the reason we sold a bunch of our bitcoin holdings was because it was unclear when the Covid lockdown in China would be relaxed. So, given the uncertainty of the Covid lockdown in China, it was important to maximize our cash position,” the Tesla boss elaborated.
We are certainly open to increasing our bitcoin holdings in the future, so this should not be taken as some kind of verdict against bitcoin. However, given the Covid shutdown in China, we were concerned about the liquidity of the entire company. And we have not sold any dog coins.
Tesla has never purchased the meme cryptocurrency Dogecoin for its balance sheet. However, the company began accepting Doggie in January for some products; Musk previously said that Dogecoin is good for payments while Bitcoin is seen as a store of value.
In a February filing with the U.S. Securities and Exchange Commission (SEC), Tesla said, ” We may increase or decrease our holdings of digital assets at any time based on business needs and our view of market and environmental conditions … We believe in the long-term potential of digital assets as an investment and as a liquid alternative to cash.”
Musk is currently in a court battle with Twitter Inc. ‘s proposed $44 billion acquisition of the social media platform, but the deal was formally struck on July 8. Twitter Inc. subsequently filed a lawsuit against Musk to force the deal. The lawsuit trial is set for Oct.
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