Elon Musk’s Tesla is at risk of a $440 million loss because of the collapsing value of bitcoins. Last year, Tesla bought $1.5 billion worth of bitcoins and became the largest company to convert some of its cash reserves into cryptocurrency. But this summer, the cryptocurrency fell in value to an 18-month low.
As of June 30, the last day of the automaker’s second fiscal quarter, bitcoin was trading at about $19,000. And the company’s investment is valued at $820.8 million. Meanwhile, three months ago, the company recorded its bitcoin value at $1.26 billion (profits from investments are not registered until sold).
So Tesla is expected to show its bitcoin savings depreciation of about $440 million later this month in its quarterly results, according to Telegraph.
About $1.3 trillion was wiped off the cryptocurrency markets in 2022. Many companies that have moved some of their cash reserves into bitcoin, such as Jack Dorsey’s Block, Coinbase, and MicroStrategy, have also suffered from the digital currency. However, the latter continues to believe in a bull market and has bought an additional 480 bitcoins for about $10 million at an average of $20,817 for each.
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And Elon Musk claims he hasn’t sold any of his crypto investments.
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