Tesla announced on Wednesday that it has sold off the majority of its bitcoin holdings after boosting the cryptocurrency last year with a $1.5 billion investment.
In the electric carmaker’s second-quarter earnings statement, the company revealed that it has jettisoned three-quarters of its total bitcoin holdings amid a collapse of the cryptocurrency market. The sale of the digital currency has added $936 million in cash to Tesla’s balance sheet, according to the company. Tesla CEO Elon Musk touted bitcoin and other forms of crypto assets leading up to the company’s purchase of the digital currency in 2021 and Tesla’s short-lived acceptance of bitcoin as payment for its electric vehicles.
“The reason we sold a bunch of our bitcoin holdings was that we were uncertain as to when the COVID lockdowns in China would alleviate, so it was important for us to maximize our cash position,” Musk said in an earnings call on Wednesday.
“This should be not taken as some verdict on bitcoin,” he said, adding that Tesla is open to more cryptocurrency purchases in the future.
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Tesla announced in February of last year that it had purchased $1.5 billion worth of bitcoin, valued at $33,000 by the end of January 2021. The company sold its bitcoin at about $29,000 a token, according to CoinDesk, suggesting that Tesla lost in the trade, but only small amounts relative to the recent plunges in bitcoin.
News of the investment pushed the cryptocurrency to an all-time high price, but since reaching its peak of $68,000 per bitcoin in November 2021, the digital currency’s value has dropped more than 66%.
Tesla has not purchased any more bitcoin since the February 2021 transaction.
In May 2021, Musk backpedaled on Tesla accepting bitcoin for purchases, citing environmental concerns related to the electronic mining of the digital coins. In the same statement announcing the end of bitcoin payments, Musk vowed that Tesla would not sell its bitcoin and said the company believes bitcoin “has a promising future.”
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On the call with investors Wednesday, Musk added that Tesla is still holding on to its shiba inu dog meme-based currency, currently valued at $0.07 per coin.
“We have not sold any of our dogecoin,” Musk said.