Tesla had invested $1.5 billion in bitcoin during the first quarter of 2021, stating that it believed in the longevity of the cryptocurrency. At the time, the company said bitcoin was a great place to store cash and still access it immediately, all the while providing a better return on investment than more traditional central banks. In fact, after its initial purchase, Tesla promptly trimmed its position by 10 percent, making the automaker a quick $101 million.
In March 2021, CEO Elon Musk said Tesla would start accepting bitcoin as payments for Tesla vehicles, causing the price of the crypto to boom. A few weeks later, Musk and Tesla backpedaled on that decision, expressing concern for the amount of energy needed to mine bitcoin. The price of bitcoin then subsequently sank.
Last year, as the value of bitcoin began to plunge, Tesla sold 75 percent of its bitcoin holdings and used the proceeds to buy traditional currency. The automaker today owns about $184 million worth of bitcoin, and may be holding out for a rebound.
The crypto market has experienced a dramatic drawdown over the past year. Today, bitcoin is trading at $23,045.50, which is about 66 percent below the all-time high of $68,789.63. Despite losing over half its value, some experts say bitcoin has remained resilient and may experience a comeback, especially as buyers spooked by the crypto market in general gravitate toward household names and more mature ecosystems, like bitcoin or ether.
Tesla disbanded its press department and could not be reached for comment.
TechCrunch