Home Bitcoin Tesla Bitcoin Funding Dwindles By $440 Million As Crypto Winter Drags On

Tesla Bitcoin Funding Dwindles By $440 Million As Crypto Winter Drags On

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Tesla wasn’t the one to be left behind and disclosed a $1.5 billion Bitcoin purchase on February 8. The crypto buying splurge was made in a filing with the US Securities and Exchange Commission.

The purchase, Tesla said, was part of its updated investment portfolio, which the company’s audit officials gave the thumbs up to.

Since then, Bitcoin’s value has decreased by more than half. Bitcoin was at $19,000 as of June 30, the last day of Tesla’s second fiscal quarter. And as of this writing, Bitcoin was trading at $19,735, down 0.5% over the previous week.

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Tesla Bitcoin Holdings Shedding Value Lately

Tesla’s investment in Bitcoin has declined dramatically in recent months. In the second quarter financial report of 2022, Tesla’s BTC holdings had a $440 million decrease in the wake of the continued bear market.

At the end of June, Tesla’s BTC investment dropped to approximately $820 million as a result of the fluctuating price of the crypto.

Tesla valued its Bitcoin at $1.26 billion three months ago. Despite the fact that the firm’s BTC coffers contained approximately $2 billion worth of the crypto, the electric vehicle’s accounting practices mean it doesn’t see any profits until it sells.

This indicates that the Austin, Texas-based carmaker will likely record a write-down of its Bitcoin holdings of around $440 million, or approximately 9 percent of its yearly sales in 2021.

Bitcoin Losing Its Shine This Year

Since the beginning of the current fiscal year, Bitcoin’s performance has been miserable. Other cryptocurrencies, like Ether, Dogecoin, Litecoin, to name a few, have also been impacted by the recurrent declines.

BTC total market cap at $381 billion on the daily chart | Source: TradingView.com

Bitcoin was trading for more than $46,000 at the beginning of the year, but its value has dramatically reduced since then. Since reaching its all-time high in November of last year, Bitcoin’s price has dropped by about 75%.

MicroStrategy and Block Inc. are among the companies who have converted a portion of their cash reserves into Bitcoin.

On June 19, the price of Bitcoin plummeted significantly to $17,700, causing many companies with Bitcoin-based wagers to suffer.

In barely half a year, more than $2 trillion has been erased from the overall crypto market valuation because of a catastrophic crypto crisis that some sectors believe may just be warming up.

As of this writing, Tesla shares were trading in extended session at $679.80 a share. The current price is approximately 0.30 percent lower than its previous close of $681.79.

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Featured image from Republic World, chart from TradingView.com

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