Yesterday, Tesla released its earnings report for the first quarter of 2021. In February, the company bought Bitcoin worth $ 1.5 billion. According to the report, Tesla sold at least 10% of its position for a profit of $ 101 million.
Both the company and its CEO Elon Musk have received heavy criticism from the crypto community and others. Dave Portnoy, owner of DDTG Global, accused Musk of “throwing” his BTC at investors in order to “make a fortune”. Tesla’s CEO replied to Portnoy, explaining the reason for his company’s decision:
I haven’t sold any of my bitcoin. Tesla sold 10% of its holdings essentially to prove Bitcoin’s liquidity as an alternative to keeping cash on balance sheet.
As reported by NewBTC, Tesla was likely trying to hit a specific goal for that first quarter and with that intention sold some of its BTC. Data from the New York Times shows the automaker posted a quarterly profit of $ 438 million, an all-time high for the company.
In addition, Tesla has made approximately $ 518 million from carbon credits for various companies. By comparison, the company made $ 164 million on this type of loan last year. In total, Tesla made over $ 1 billion in the first quarter of this year.
The company is facing difficulties such as the global shortage of computer chips, according to the New York Times report, and obstacles in its supply chain. However, Zach Kirkhorn, CFO of Tesla, or Master of Coin, his official title, said their Bitcoin investment “turned out to be a good decision”.
Kirkhorn added that the company will continue to invest some of its capital in BTC and increase its holdings of vita that its customers buy using the cryptocurrency.
Bitcoin was key to Tesla’s record first quarter results
CNN’s reporter Clare Sebastian emphasized that Bitcoin was the “fine print” in Tesla’s report. The gain for liquidating this small portion of their BTC holdings accounted for nearly 25% of their profitability.
The company has a record 7 quarters of earnings but is now facing the aforementioned crisis in its supply chain. Musk expects the chip shortage to last at least until 2023. As such, Bitcoin will most likely continue to be a central part of the company’s financial strategy.
Additional data from the Bitcoin Treasuries monitor shows that Tesla, Inc still ranks second in the ranking of listed companies that have bought BTC. The company, run by Moschus, holds around 48,000 BTC, or 0.229% of the total supply of the cryptocurrency.
Tesla ranks second in terms of BTC stocks. Source: Bitcoin Treasuries
MicroStrategy leads the way at 91,579 BTC, or 0.436% of supply. A total of $ 1.4 billion (6.78% of total BTC supply) is held by publicly traded companies.
Bitcoin is trading at $ 54.019, up 2.7% on the daily chart. On the weekly and monthly charts, BTC shows a sideways movement.
BTC with small profits in the daily chart. Source: BTCUSD Tradingview
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