Tesla sells 75% of its Bitcoin holdings as manufacturing concerns and Covid shutdowns impacted on profits

Tesla sells 75% of its Bitcoin holdings as manufacturing concerns and Covid shutdowns impacted on profits

According to Tesla, it still has digital assets valued at $218 million. Elon Musk addressed the transaction in a conference call with investors, saying that no Dogecoin had been sold and that the selloff “should not be viewed as some conclusion on Bitcoin.” Tesla’s CEO cited concerns “about overall liquidity of the company given COVID shutdowns in China” as the reason for selling its Bitcoin. In addition, Musk discussed the company’s newest factories in Texas and Berlin, which he claimed are currently losing “billions of dollars.”

Elon Musk CEO of Tesla

Musk claimed Tesla would soon start taking the cryptocurrency as payment for Tesla items a month after disclosing its initial Bitcoin investment last year. But he quickly changed his mind and suspended the benefit because of Bitcoin’s negative effects on the environment.

In the first quarter of the year, Tesla posted $3.3 billion in profits, a record. Yesterday, the business announced a $2.26 billion net profit, a decrease of almost 31.5 percent from the previous quarter. From $16.9 billion in Q1 to $18.7 billion in Q2, the quarterly revenue likewise decreased.


Because of more deliveries and a higher average selling price—the company has increased the price of its vehicles this year, including a $6,000-maximum hike last month—the Q2 2022 figures are still better than the same period last year when Tesla made $1.1 billion in profit and $11.9 billion in revenue.

A decrease in sales and profit was anticipated after Tesla earlier acknowledged that its deliveries dropped 18 percent as a result of the supply problems and the Covid shutdowns in China. In response to Musk’s “very terrible feeling” about the economy, the company also eliminated 10% of its workforce. This week, Bitcoin had seen a minor recovery. Last Tuesday (July 12), BTC was trading about $19,000, but by Wednesday it had risen to roughly $24,200. Following Tesla’s announcement, the value reverted to $22,700.

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