Tesla Bitcoin investment drops by $ 440 million as the crypto winter continues
Tesla was not the one left behind and revealed a $ 1.5 billion Bitcoin purchase on February 8. The crypto purchase was made in an archive to the US Securities and Exchange Commission.
The acquisition, Tesla said, was part of the updated investment portfolio, which the company’s audit officials gave a thumbs up to.
Since then, Bitcoin’s value has fallen by more than half. Bitcoin was at $ 19,000 as of June 30, the last day of Tesla’s second accounting quarter. As of this writing, Bitcoin was trading at $ 19,735, down 0.5% from last week.
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Tesla Bitcoin Holdings has been losing value lately
Tesla’s investment in Bitcoin has fallen dramatically in recent months. In the financial report for the second quarter of 2022, Tesla’s BTC holdings declined by $ 440 million in the wake of the continuing bear market.
At the end of June, Tesla’s BTC investment fell to approximately $ 820 million as a result of the fluctuating price of the crypto.
Tesla valued its Bitcoin at $ 1.26 billion three months ago. Despite the fact that the company’s BTC cash register contained the crypto value of approximately 2 billion dollars, the electric car’s accounting practice means that it does not see any profit before it is sold.
This indicates that the Austin, Texas-based automaker is likely to record a write-down of its Bitcoin holdings of around $ 440 million, or about 9 percent of annual sales in 2021.
Bitcoin is losing its luster this year
Since the beginning of the current financial year, Bitcoin’s performance has been poor. Other cryptocurrencies, such as Ether, Dogecoin, Litecoin, to name a few, have also been affected by the recurring declines.
BTC total market cap at $381 billion on the daily chart | Source: TradingView.com
Bitcoin traded for more than $ 46,000 at the beginning of the year, but its value has declined dramatically since then. Since it reached a record high in November last year, Bitcoin’s price has fallen by around 75%.
MicroStrategy and Block Inc. are among the companies that have converted part of their cash holdings to Bitcoin.
On June 19, the price of Bitcoin dropped significantly to $ 17,700, which led to many companies with Bitcoin-based bets suffering.
In less than half a year, more than $ 2 trillion has been erased from the overall valuation of the crypto market due to a catastrophic cryptocurrency crisis that some sectors believe may be heating up.
At the time of writing, Tesla shares traded in the extended session at $ 679.80 per share. The current price is about 0.30 percent lower than the previous close at $ 681.79.
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Featured image from Republic World, chart from TradingView.com
