Tesla’s second quarter financial results revealed that the company had sold 75% of all of its Bitcoin holdings. The sale of Tesla’s holdings generated $936 million in fiat currency for the company.
Elon Musk sells 75% of the company’s Bitcoin holdings
Tesla is one of the largest electric car manufacturers in the world. The company has been one of the largest corporate shareholders with exposure to cryptocurrencies. When buying its Bitcoin holdings last year, Tesla said it wanted to demonstrate the major cryptocurrency’s long-term potential.
During the second quarter earnings call, Tesla revealed that the sale of the company’s Bitcoin holdings generated $936 million in revenue. However, company CEO Elon Musk said the selloff should not be taken as a verdict on Bitcoin.
In the earnings call, Musk said that the company had sold Bitcoin to cover production costs in China, which had been affected by the COVID-19 pandemic. The necessary money was raised after the company sold 75% of its Bitcoin holdings.
The news slightly affected Bitcoin, which fell from around $24,000 to below $23,000. Musk was one of the biggest voices in the cryptocurrency space last year and even helped drive a massive rally in early 2021 after Tesla announced the addition of Bitcoin to its portfolio. Tesla had even said it would approve crypto payments before halting those plans due to environmental concerns.
Musk explained the recent sale of Tesla’s largest Bitcoin holdings. He said the company has seen a steady increase in production costs in China due to COVID-19 related lockdowns. Musk said selling almost $1 billion worth of Bitcoin would allow the company to meet production costs.
According to Musk, the sale would allow the electric car maker to meet its cash flow needs. The money would be used as capital to support new Tesla factories in Germany and the United States. In the past, Musk has said the Austin and Berlin facilities were “gigantic money ovens”.
Elon Musk still owns the crypto
During the earnings call, Musk revealed that he did not sell any Dogecoin from Tesla. The CEO of Tesla is a big bitcoin advocate. In the middle of last year, Musk revealed that he had invested some of his personal wealth in several cryptocurrencies, including Bitcoin, Ethereum and Dogecoin. In March last year, he said he would not part with his crypto holdings.
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