In response to the Tesla Bitcoin sale accusations, Elon Musk admits he bought Bitcoin for personal holdings and not only Tesla
Noone knew that Elon Musk holds Bitcoin for personal capacity. The only news that made headlines globally was Tesla buying $1.5 billion worth of Bitcoin. Tesla was the first among global carmakers to dip their toes in the crypto space. Their decision to buy Bitcoin made corporations discuss adding Bitcoin to the corporate treasury.
A Twitter user accused Elon Musk and Tesla of only caring about profits and not being true Bitcoin proponents. Musk, in his response to the tweet, said that he has bought some Bitcoin and is holding them. He did not shy away from accepting that Tesla, indeed, sold one-tenth of its Bitcoin holdings.
He said in the tweet that the decision to sell a part of Tesla’s Bitcoin holdings was not to make quick profits. It was more of a statement to show Bitcoin’s immense liquidity in the market. He also added that he is still holding onto Bitcoins that he bought in his personal capacity.
The Financial Performance in Q1
Tesla’s first-quarter proved to be its best so far. Their revenue is $10.4 billion with $438 million in net income, which is a record figure for the electric car maker. What’s even more surprising was Tesla’s projection of total cars that it expects to deliver this year. The company believes that they will ship over 50% more cars this year than what they did in 2020. In absolute numbers, the figure comes to around 0.8 million deliveries.
Tesla Made More Profits From Bitcoin Than Cars
Tesla’s profits from Bitcoin was $101 million on an investment of $1 billion a couple of months ago. Zachary Kirkhorn, Chief Financial Officer of Tesla, reiterated Tesla’s stand on Bitcoin on an earnings call. He said that Tesla believes in the long-term value of Bitcoin.
Q1 2021 proved to be a successful quarter for Tesla. But the major share of profits that Tesla made this quarter was not from selling cars. Instead, regulatory credits and Bitcoins generated most of Tesla’s profits. Selling one-tenth of its Bitcoin holdings helped Tesla net a profit of $101 million. The sale of regulatory credits added a sum of $518 million to Tesla’s coffers. Without the sale of Bitcoin and regulatory credits, Tesla’s quarterly balance sheet would have been in the red.