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Tesla Sold 75 % Of It's BITCOIN | Tesla News | Elon Musk News | Tesla Bitcoin - YouTube
Channel: Tech Heaven
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Only a year after defining Bitcoin as a digital
asset with "long-term potential," Elon Musk's
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Tesla sold off 75% of its holdings in 2022.
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Early last year, the electric vehicle manufacturer
invested $1.5 billion in BTC.
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Welcome to “Tech Heaven'' and in this video,
we’ll see why Tesla sold 75 percent of its
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Bitcoin…
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Tesla has already converted 75% of its Bitcoins
into fiat currency, earning $936 million from
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the transaction.
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According to Tesla's second-quarter earnings
report, which was released on Wednesday, "As
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of the end of Q2, we had converted approximately
75% of our Bitcoin purchases into fiat currency."
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Conversions added $936 million to our balance
sheet in the second quarter."
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The second quarter of 2022 was one of the
worst in the history of cryptocurrency markets.
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The price of bitcoin fell from around $46,000
at the start of the quarter to under $19,000
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during the period, which has also been dubbed
a "crypto winter."
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Elon Musk was a major cryptocurrency influencer
during last year's massive rally, which saw
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BTC rise to near $69,000, with many so-called
experts predicting the oldest cryptocurrency
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will soon cross the $100,000 mark.
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However, all predictions have come to naught
this year, as crypto markets have lost around
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$2 trillion in market capitalization, and
several crypto companies are on the verge
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of bankruptcy.
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Tesla's sale of Bitcoins represents a rapid
retreat for Musk.
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Nonetheless, he stated in the earnings call
that the sale should not be interpreted as
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a verdict on Bitcoin.
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He stated that Tesla sold Bitcoins to maximize
cash position in light of the uncertainty
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caused by Covid lockdowns in China.
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"It was critical that we maximize our cash
position...
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We are open to increasing our bitcoin holdings
in the future, so this should not be interpreted
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as a verdict on bitcoin.
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"It's just that we were concerned about the
company's overall liquidity," Musk was quoted
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as saying by news agency Reuters.
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Tesla has not disclosed the price at which
it liquidated its Bitcoin holdings.
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Musk, on the other hand, stated that Tesla
is open to increasing its crypto holdings
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in the future.
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By the way, if you are watching us for the
first time, make sure to hit that subscribe
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button and turn on notifications so you can
enjoy our future videos while getting updated.
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Getting back to the topic, let’s move on
to …
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Following Tesla's earnings announcement, Bitcoin
fell below $23,000 for the second time in
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three days, after having gained for three
days in a row.
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It was trading at $22,895 at the time of writing.
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Tesla has already reported vehicle shipment
figures for the second quarter, and its full
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Q2 2022 financial report reveals that it is
dealing with inflation and the overall economic
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downturn, as well as a drop in Bitcoin and
other cryptocurrency prices.
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Tesla executives reveal in a letter to investors
that the company has sold 75 percent of its
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Bitcoin holdings, adding $936 million to its
balance sheet.
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Tesla invested $1.5 billion in Bitcoin last
year and announced that it would accept Bitcoin
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as payment.
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Tesla began accepting Bitcoin in late March,
then abruptly stopped accepting it 49 days
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later, in May.
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Tesla reports that the value of its remaining
"digital assets" is $218 million, down from
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around $1.2 billion in previous quarters.
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Tesla CEO Elon Musk stated in July, "I might
pump, but I don't dump...
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I definitely do not believe in setting a high
price and then selling it.
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I want to see Bitcoin succeed."
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Musk addressed the crypto selloff during an
investor call, saying that it "should not
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be interpreted as a verdict on Bitcoin."
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Instead, he stated that Tesla sold its Bitcoin
because it was "concerned about the company's
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overall liquidity given COVID shutdowns in
China."
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Essentially, Tesla required the funds.
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"We have not sold any of our Dogecoin," Musk
stated, later calling cryptocurrency "a sideshow
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to the sideshow."
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When it comes to its business of making electric
cars, where new competitors appear every day,
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and solar products, the company reports a
$2.26 billion profit this quarter, a 31 percent
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decrease from the previous quarter's profits
of $3.3 billion.
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The profit was earned on $16.9 billion in
revenue, which is also lower than the $18.7
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billion reported in Q1.
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In terms of profitability, the company is
still doing better than it did in the second
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quarter of 2021, when it earned $1.1 billion
on revenue of $11.9 billion.
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The company attributes this to a variety of
factors, including "lower stock-based compensation
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expense," increased vehicle deliveries over
the previous year, and a higher average selling
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price.
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This is the first full quarter since Tesla
raised prices on all of its vehicles by up
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to 10%, and it raised prices on select models
again in June.
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Despite the price increases, the company has
deviated from its quarterly trend of earning
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more per car.
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In the first quarter, its gross automotive
margin was 32.9 percent.
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It was 27.9 percent in the third quarter.
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Tesla announced earlier this month that deliveries
have slowed, with a drop of around 18% compared
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to Q1.
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It also produced about 15% fewer cars this
quarter than the previous.
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According to Tesla's earnings report, the
company experienced "limited production and
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shutdowns in Shanghai for the majority of
the quarter," but it continued to ramp up
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production at its new facilities in Berlin
and Austin, Texas.
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Other difficulties cited by the automaker
include higher prices for everything from
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raw materials to logistics, higher fixed costs
per car due to Shanghai closures, and, of
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course, the aforementioned "Bitcoin impairment."
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The company's revenue from selling regulatory
credits to other automakers fell nearly 50%
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from the previous quarter.
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It made $679 million from credits in the first
quarter, but only $344 million in the second.
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The credits assist other companies that do
not produce enough "clean" vehicles to meet
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regulatory standards in the United States
and the European Union.
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Tesla has had a turbulent quarter in terms
of culture.
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Elon Musk, the company's CEO, sold billions
of dollars in stock in late April to help
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pay for Twitter.
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Musk also reportedly stated that he has a
"super bad feeling" about the economy when
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announcing the company's hiring freezes and
layoffs.
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Tesla has been accused of violating labor
law after allegedly laying off over 500 Gigafactory
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workers.
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Earlier this month, the company also lost
its head of AI.
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But it hasn't all been bad news.
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According to an Uber report from June, Tesla's
partnership with Uber and Hertz, in which
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qualified rideshare drivers can rent the EVs
to ferry passengers around, appears to be
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going well.
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According to a fact sheet released by the
White House, non-Tesla EVs will have access
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to the Supercharger network in the United
States in 2022.
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Is Tesla Done with Bitcoin?
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Trying to predict what Musk will do, let alone
why he will do it, may be a fool's errand.
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This is the same man who recently walked away
from a multibillion-dollar deal with Twitter
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Inc.
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Having said that, we have concrete evidence
that Elon remains a "Bitcoin bull."
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For starters, he explicitly stated during
the earnings call that the option to purchase
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more Bitcoin was still open in the future.
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We are open to increasing our Bitcoin holdings
in the future.
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As a result, this should not be interpreted
as a verdict on Bitcoin.
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Furthermore, it is worth noting that Tesla
is still holding onto all of its Dogecoin.
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Although there is no direct reporting of the
amount of DOGE, we estimate the current value
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to be around $15 million.
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What does this have to do with Bitcoin?
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Though Tesla's quarterly report may contain
more pertinent information, Tesla's Bitcoin
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sales have garnered the most attention.
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So, what does this mean for the world's first
cryptocurrency in the long run?
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The big picture is straightforward.
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We have reached the apex of this latest Bitcoin
capitulation event.
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Tesla is just the latest in a long line of
companies forced to sell, including miners
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in recent weeks.
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However, seasoned Bitcoin investors see this
as proof that the bottom is near.
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Tesla has stated that it is still interested
in purchasing Bitcoin.
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However, the company, like Bitcoin miners,
requires liquidity.
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As private investors, we generally have the
luxury of not being constrained by this, which
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is why now is not the time to "buy when others
are fearful."
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And with that being said, it’s time to end
our video.
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Have you invested in Bitcoin?
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Let us know in the comments.
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Like this video and make sure to subscribe
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