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Tesla, which created confusion last year when it unveiled a major investment in bitcoin, has sold most of its cryptocurrency.
The electric car maker has disposed of 75% of its bitcoin holdings, which was worth about $2 billion at the end of 2021.
Its move comes with a drop in the value of the digital currency, which has fallen more than 50 percent this year.
Tesla said it bought cryptocurrencies for the $936 million it earned from bitcoin sales.
Tesla CEO Elon Musk has been among the most prominent advocates of cryptocurrency, and his social media statements have usually led to significant activity in the currency trading.
Tesla’s investment in bitcoin, which he unveiled in 2021, has led to an increase in demand for the currency. The price of the notoriously volatile digital currency rose last year to nearly $70,000 in November before collapsing.
Now Bitcoin is trading at less than $25,000.
Tesla last year stopped accepting bitcoin as payment for its cars, citing concerns about the climate impact of its energy-intensive bitcoin mining operations.
At the time, Musk said on social media that the company would not sell its bitcoins.
Tesla disclosed sales of its digital currency assets as part of its regular quarterly update. She said that Bitcoin was one of the factors that negatively affected the company’s profits.
However, the company revealed higher-than-expected profits in the three months to the end of June as the rise in the price of its best-selling cars helped offset the challenges it faced, including the shutdowns in China due to COVID-19.
It also promised “record-breaking results for the second half” of the year.
Tesla said its factory production in China rose to a monthly record as restrictions related to COVID-19 were lifted.
Musk said production also rose at the company’s new plants in Germany and the United States.
He had described the manufacturers in Berlin and Austin, Texas, as “giant furnaces of money”.
It is reported that Tesla shares have fallen this year by nearly 40 percent.
picture released, Getty Images
Bitcoin has lost more than 50 percent of its value.
Another promise from Mask that he didn’t keep
The BBC’s James Clayton says that Elon Musk last year turned to Twitter to define Tesla’s stance on bitcoin.
“Tesla will not sell any of the bitcoins it owns,” he said. This seemed to be a firm stance.
However, statements from the world’s richest man should not be taken lightly.
We now know that one year after that tweet, Tesla has sold most of its bitcoins.
Do you notice a pattern here perhaps?
Whether it’s the promise of driverless technology or the purchase of social media companies, Musk’s statements don’t always come true.
This does not appear to have harmed his work, yet. But this is another opportunity to remind that his words, which can move markets, are not etched in stone.
This move is bad news for Bitcoin and cryptocurrencies in general. Musk is a supporter of cryptocurrencies, and has helped raise the value of currencies such as Bitcoin and Dogecoin.
Musk said that this move is not a position on Bitcoin, but more about the need for cash.
But he described the cryptocurrency as a “side-show.” This description is not a resounding endorsement of the coin.