Tesla gets rid of 75% of its bitcoin holdings

Tesla sold off most of its cryptocurrency holdings, one year after the company revealed a large investment in Bitcoin as the digital currency continues to lose its value. 

Elon Musk’s company got rid of 75% of its Bitcoin, worth about $2 billion at the end of 2021, according to the company’s Q2 2022 financial report. The company said it sold the digital currency for $936 million and used it to buy traditional currency. 

“As of the end of Q2, we have converted approximately 75% of our Bitcoin purchases into fiat currency,” Tesla said in a statement. 

In February 2021, Tesla revealed a $1.5 billion investment in Bitcoin, which prompted a surge in the digital currency. The company said it will keep $218 million worth of “digital assets.”

Additionally, last year, just 49 days after Tesla had announced that it would accept Bitcoin as payments, the car company suddenly announced it would stop accepting Bitcoin as a form of payment for its cars, citing environmental concerns over the currency’s energy-intensive mining. 

Despite the change, Musk—a crypto enthusiast—claimed that Tesla would not sell any of its Bitcoin. A claim that has changed with today's announcement. 

The company’s sell-off comes as cryptocurrencies in general are losing their value in the market. Over the past four months, Bitcoin has lost half of its value. 

In November of last year, one Bitcoin reached $70,000. However, the market soon crashed and now one single unit is trading for less than $25,000. 

“We are certainly open to increasing bitcoin holdings in the future. So this should not be taken as some verdict on Bitcoin. It’s just that we were concerned about overall liquidity for the company given COVID shutdowns in China,” Tesla CFO Zachary Kirkhorn said.