Leading electric car maker Tesla has sold off a large chunk of its Bitcoin holdings. The company’s financial statements released on July 20 show that it has converted around 75% of its bitcoin holdings into fiat currency.
Tesla sells 75% of its Bitcoin holdings
from Tesla quarterly filings show that the company converted around two-thirds of its bitcoin holdings to fiat, which generated an additional $936 million on its balance sheet. The financial statements show that the company’s net assets have remained stable for three consecutive quarters.
At the end of the first quarter of 2022, Tesla had digital assets worth $1.261 billion in its holdings. After the recent sale, the company now has $218 million invested in digital assets. This isn’t the first time Tesla has dumped some of its bitcoin holdings.
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In March last year, Tesla sold 10% of its Bitcoin reserves, making a net profit of $128 million. The electric car maker’s CEO, Elon Musk, said the sale of 10% of Tesla’s BTC holdings was intended to demonstrate the liquidity of the major cryptocurrency. The sale was to prove Bitcoin’s liquidity as an alternative to holding fiat currency on a company’s balance sheet.
Tesla was one of the largest bitcoin holders in the world. In January this year, the electric car maker acquired $1.5 billion worth of Bitcoin. The purchase of these new coins was disclosed in a filing with the United States Securities and Exchange Commission (SEC).
Early last year, Tesla planned to approve bitcoin payments. However, the plans were thwarted after Musk announced that there were concerns over Bitcoin’s high energy requirements.
The recent selloff only caused Bitcoin prices to drop slightly. On Wednesday, Bitcoin managed to gain $24,000. At the time of writing, the coin was trading at $22,900 after falling 3% in the last 24 hours.
Tesla’s Second Quarter 2022 Financial Results
The electric car maker reported a shaky second quarter of 2022. The company’s earnings for the period fell 32% from the first quarter. Tesla’s net profit for the second quarter of 2022 was $2.26 billion.
Prior to the release of these financial results, Musk had revealed that he had a “super bad feeling” about the economy and that the company would be forced to lay off around 10% of its workers. Tesla was among the companies affected by the global supply chain crisis and economic turmoil.
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