Past year, Tesla made it public that they made a gigantic investment into crypto, Bitcoin to be more precise. Now, after one year, Tesla’s CEO changes his mind and sold all Bitcoin that they’ve acquired.
The Bitcoin that Musk sold would have been valued at $2 billion back in 2021. However, now, he got much less for it. It is a clearly foreseeable move by the billionaire, since, at the moment, Bitcoin has fallen by more than 50% in comparison with last year.
Tesla’s Elon Musk Sold All His Bitcoin Holdings
We need to notice that this is not the first time that the billionaire is selling crypto acquired through sales in Tesla. The company had already recorded a sale of about $100 million in crypto last year only.
From its most recent sale, Tesla now obtained a little above $930 million. Musk reveals that for now, he will stick to traditional currency, at least in Tesla.
Elon Musk, Tesla’s CEO, is one of the few high-profile people that has been vocal in his support for crypto in the past. Many times, his posts on social media and his public statements regarding some cryptocurrencies created a trading wave in the crypto market.
His deeds also impact the trading price on a great scale. For example, when Tesla made the $1.5 billion investment in Bitcoin at the start of 2021 that created a surge of demand for the currency. People tend to follow him as they believe in his choices. And he was right to an extent, but he failed to sell at the right moment. The price of Bitcoin reached an incredible $70 000 in November before it went full speed down. Now, the price for one bitcoin is about $25 000.
Last year, Tesla announced that they will stop accepting Bitcoin as payment for their products. The reasoning behind it is the concerns about the climate impact of Bitcoin mining.
However, at the time Musk said that he will not sell the Bitcoin he already has acquired through the sales. And now, this is just another promise that Elon broke.
Last year he proudly announced on Twitter that he will not sell any of the cryptos that the company has.
“Tesla will not be selling any Bitcoin.” – He states on Twitter, and it sounds pretty convincing. But, as we are already aware, the world needs to take Elon’s statements with great ‘reserve’. He made a habit out of not keeping his word up.
Regardless of what we speak about, driverless tech, or buying social media, Musk doesn’t fulfill his promises always. But it seems that he is OK with it since he hasn’t faced any consequence because of his deeds not following his mouth. He is still the wealthiest man on Earth, and his business is still booming.
Bitcoins are the ones that will feel Elon’s ‘betrayal’ the most. He is one of the most vocal advocates for cryptocurrencies, so selling his shares in Bitcoin might indicate a potential even more harsh fall on market. Elon’s decision to sell will impact them greatly.
Yet, according to Musk, the sale is not connected to Bitcoin’s fall in value, it is more of a sudden need for money to boost some of his projects.
From Tesla, they share the news of the sale as part of the regular quarterly update. In the statement where they address Bitcoin, the company states that the sale is because Bitcoin is hurting the profitability of the company in general.
If you thought that Musk didn’t think of a way to boost the profit of the company, you’d be wrong. The board of directors has made a decision to increase the price of each Tesla model by 5-10% and with that, they normalized the profit. Furthermore, they managed to offset the recent challenges of Tesla, such as the lockdown of Tesla’s China plant.
Moreover, in the quarterly report, the company made a prediction that in the second half of 2022 they expect to have a record-breaking profit and sales. Most of this is due to the lift of restrictions due to Covid 19 in China.
Factories in Germany and the USA as well mark a significant increase in revenue. They are seen as gigantic money furnaces.
However, despite all this, the price of Tesla shares on the stock market is going through a massive fall. The company reached its peak in stock market price back in April this year when a single share of the company had a cost of about $1150. The increase in price caused Musk to top his net worth to around $300 billion. Now, the price per Tesla share is about $740. That is a fall of about 35%.
Elon was claiming that he is sure that a financial crisis is on the verge of happening, just weeks ago. He was saying this while stacking money from all over the world. It is clear why the world is not taking his words for granted anymore.
The billionaire has recently backed off from the deal to buy the social media Twitter for $44 billion. He states that this is due to the fact that the social media company had lied that it had less than 5% spam/fake accounts. However, many see this only as an excuse to back off from the deal. While the real reason might be the fall in the price of the social media since April when the deal was struck.
While in April the price was topping at about $54, now it is less than $40. At one point it had a fall of about 30%.
