The leading EV manufacturer got rid of bitcoin amidst a crypto winter
In its Q2 2022 earnings report, the electric car company revealed it has exchanged 75% of its Bitcoin holdings for fiat currency. The company sold the coins for $936 million. Tesla estimates its remaining “digital assets” at $218 million.
Last February, the company was very optimistic about bitcoin. Not only did Tesla purchase $1.5 billion worth of the cryptocurrency with its balance sheet capital but also planned to accept BTC as payment for its vehicles. Later, Elon Musk suddenly announced they were abandoning plans to accept crypto payments, expressing concern about bitcoin’s sustainability. Nevertheless, the EV giant didn’t ditch its crypto assets immediately.
The company’s selloff comes amid the so-called crypto winter. A steep decline in the price of cryptocurrencies got aggravated by the crash of Terra stablecoin and the bankruptcies of leading crypto brokerages. At the same time, the company’s executives said the sale was not linked to crypto market volatility. They claim a desire to maximise cash positions during the economic uncertainty was the main reason.