Here are the main stages of the romance between Tesla and Bitcoin:
- Tesla is the first global company to accept Bitcoin
- Tesla buys Bitcoin in quantity: $1.5 billion of this cryptocurrency in February 2021.
- Tesla no longer accepts Bitcoin due to Bitcoin’s carbon footprint
- Tesla sells 75% of its Bitcoin holdings
Should we see the end of cryptocurrencies at Tesla? surely not.
A need for cash caused by China and the Covid
In its note to shareholders, the company explains that it sold its Bitcoins because of the uncertainty linked to the closure of Shanghai, and a need for cash to deal with it. They state that they have nothing against Bitcoin and that they are open to buying more in the future.
Here are the translated language elements:
“It should be justified that the reason we sold a large portion of our bitcoin holdings was that we were uncertain about when the COVID lockdowns in China would ease. It was therefore important for us to maximize our cash position, given the uncertainty of COVID lockdowns in China. We are fully open to increasing our bitcoin holdings in the future. It should therefore not be seen as a verdict on bitcoin. It’s just that we were concerned about the overall liquidity of the business given the COVID shutdowns in China. And we haven’t sold any of our Dogecoins”.
Ultimately, they are an automotive company, not a bitcoin company. Bitcoins will always be relegated to the background.
Too much Bitcoin left?
For some, this remaining investment is a considerable risk, but for others it is proof of the initial logic and the confidence retained in the asset.
Nevertheless, the company’s challenges lie well elsewhere. Thus, cryptocurrencies are not at all what the company is really thinking about. The current challenges are: scaling up production and accelerating the advent of sustainable energy.
And to answer you. No, Bitcoin didn’t ruin Tesla’s life as the company made $64 million in profits from the operation.
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