One of the richest persons, Elon Musk is again in the limelight as we all know that he ventured into some crypto projects eg Dogecoin, Shiba Inu, etc. Blockchain firm Arkham Intelligence lately said in its report that Tesla transferred around $765 million worth of Bitcoins to some wallets which are questionable right now.
This massive transaction has raised eyebrows and speculations. What is Tesla actually doing amid these market concerns? Will BTC fall again like in 2022? Does Telsa know something that the world does not know? Well, time will tell everything. As of now, Tesla has not shared an update leaving some market experts in suspense.
According to crypto experts, Tesla has reserves of the fourth-largest stash of Bitcoin among the U.S. public organizations. There are only three giants MicroStrategy, MARA Holdings, and Riot Platforms hold reserves much more than that.
Tesla’s BTC reserves still is just less than 1% of the company’s total $705 billion market capitalization.
In 2021 Tesla was the talk of the town when it invested around $1.5 billion in Bitcoin. However, Musk clarified that he just wanted to diversify his company’s portfolio. He also supported his interest in crypto car payment through crypto transactions.
That single news at that particular time frame soared the value of BTC to $10,000. But in mid-2021, he also questioned the mining of BTC. He told the reports that BTC’s mining could increase the dependence on coal and other fossil fuels which will impact the earth’s environment in the coming years.
Consequently, his reports hit Bitcoin hard and suddenly BTC plunged 10% overnight which raised the sustainability of BTC and other crypto assets in the crypto community. As a result, this news sent shockwaves to various crypto investors.
But seems like Musk will do whatever he wants to do. He clearly took his stand that his company would never sell off its BTC reserves and would restart the purchases once the mining process shifted towards renewable energy sources.
In 2022, Tesla reported that it had sold off most of its Bitcoins at about $20k per coin, quite lower than it initially paid for it. Crypto community quickly noticed that the company had sold near the bottom of the market, losing most of its significant potential profits.
Despite this sell-off, Tesla still had reserves of BTC around less than 10,000 Bitcoin – which has significantly increased over 350% to 400% since the initial purchase.
According to Forbes, Bitcoin is hitting near lifetime highs far surpassing the company’s original buying price of 43,200 BTC.
Now, the crypto community will wait to see what will happen next since this transaction of Tesla is particularly interesting.
The Financial Accounting Standards Board (FASB) has amended its guidelines, which require digital assets like Bitcoin and other coins to be marked at their fair value. So this transaction by Tesla raised some serious questions since these guidelines will be implemented in December.
These new rules will permit companies to show their gains and losses in their financial sheets, which could impact how firms like Tesla approach their BTC holdings.
