Key highlights:
- Tesla held almost $2 billion worth of Bitcoin at the end of 2021
- The company invested $1.5 billion into Bitcoin in February 2021
- Tesla is currently the second-largest holder of Bitcoin among publicly-traded companies
Tesla held almost $2 billion worth of Bitcoin at end of 2021
Electric vehicle manufacturer Tesla held almost $2 billion worth of Bitcoin at the end of 2021, according to a filing with the SEC. For the year, Tesla recorded $101 million in impairment losses and $128 in realized gains from its Bitcoin investment. In the filing, Tesla said they see long-term potential in digital assets:
“We believe in the long-term potential of digital assets both as an investment and also as a liquid alternative to cash.”
Tesla’s $1.5 billion investment into Bitcoin was disclosed on February 8, 2021, and significantly boosted sentiment in the cryptocurrency markets. At the time of the announcement, Bitcoin was changing hands below $40,000. The price of the world’s largest cryptocurrency then quickly climbed to a new all-time high of $47,900 and surpassed $50,000 by February 17.
Tesla’s Bitcoin holdings at the end of last year had a market value of $1.99 billion. The company hasn’t been holding its BTC investment completely passively, as they sold around 10% of their Bitcoin holdings in the first quarter of 2021. The sale brought $272 million in proceeds for Tesla. Since this sale, Tesla hasn’t bought any additional Bitcoin or sold any additional coins.
Tesla has one of the biggest stashes of Bitcoin among publicly-traded companies. According to BitcoinTreasuries, the only publicly-traded company with larger Bitcoin holdings is MicroStrategy, which owns about $5.5 billion dollars worth of BTC. Marathon Digital Holdings is currently the third largest Bitcoin holder in this category, with around $358 million worth.
After investing in BTC, Tesla briefly extended its involvement with Bitcoin by accepting BTC as payment for its vehicles. However, Tesla abandoned support for Bitcoin payments shortly after launch, citing environmental concerns related to Bitcoin mining. Earlier this year, Tesla dipped its toes into crypto payments again by accepting Dogecoin as payment for merchandise (but not vehicles). Dogecoin has been a favorite of Tesla CEO Elon Musk, who often references the cryptocurrency in social media posts.
TSLA shares have had a rough start to 2022, as they’ve shed about 21.8% of their value since January 1. Bitcoin has been holding up better in the same time period, as it’s down by 6.9%.