Tesla sells 75 per cent of its Bitcoin as profits slump in crypto U-turn for Elon Musk

euronews.com:

Tesla has sold a large proportion of its cryptocurrency holdings, after making waves last year revealing it had a significant investment in Bitcoin.

The company, which is the second largest electric vehicle manufacturer globally, exchanged 75 per cent of its holding in Bitcoin which has plunged in value over recent months.

On Wednesday, Tesla sold $936 million (€919 million) of the world’s largest crypto during its second financial quarter – worth around $2 billion (€1.96 billion) at the end of 2021.

In February, it was revealed that the firm invested $1.5 billion (€1.46 billion) in crypto, which prompted a surging demand and raised the value of Bitcoin.

Crypto markets are notoriously volatile, with Bitcoin reaching an all-time high of almost $70,000 (€68,195) in November 2021. Now, it is trading at less than $25,000 (€24,368).

The announcement comes after an unsteady end to Tesla's second quarter of 2020 – the firm's profit fell 32 per cent from record levels earlier this year.

The drop in profits can be attributed to struggles to keep up with demand due to its factory in Shanghai closing and production challenges in other plants.

In June, Tesla CEO Elon Musk said he had a “super bad feeling” about the economy, stating that the firm needed to lay off 10 per cent of the company’s salaried workers – as reported by Reuters.

Musk has said the sale of Tesla’s Bitcoin holding was to maximize its cash position in a time of uncertainty. On a Wednesday earnings call, Musk noted that the move “should not be taken as some verdict of Bitcoin”.

Last year, Tesla stopped accepting Bitcoin as payment for its cars due to concerns over the impact Bitcoin has on the environment.

At the time of the announcement, Musk tweeted he would not be selling