• In February 2021, Tesla announced its intention to sell cars using Bitcoin and invested $1.5 billion in the cryptocurrency.
• By autumn of that year, the price of Bitcoin had reached historic highs of around $70,000.
• However, by early 2023, Bitcoin’s value had dropped significantly and Tesla recorded a gross impairment loss of $204 million for 2022.
Tesla Announces Plans to Sell Cars Using Bitcoin
In February 2021, Tesla revealed its plan to sell automobiles using Bitcoin. This prompted the crypto’s price to skyrocket while also investing $1.5 billion in it. At the time of investment, one BTC was worth around $43,000 which increased up to a record-high of about $70,000 by the autumn of 2021 due to Elon Musk’s passionate support for cryptocurrency.
Bitcoin Value Drops Significantly
Fast forward to Feb 1st 2023 – Bitcoin is trading at only $23,133 – losing more than half its value from its all-time high in Autumn 2021 due to the bear market that shook the market after Terra Luna’s implosion in May last year. Tesla has removed any verbiage about their optimistic stance on investing in crypto from their previous annual reports and disclosed that they have suffered an impairment loss of $204 million in 2022 and realized gains of only $64 million during that same period.
Market Analysts Believe Crypto Will Rebound
Despite losing 70% of its value since 2021 some market analysts believe Bitcoin will still undergo a rebound due to consumer interest being drawn towards more established ecosystems like Bitcoin and Ethereum (ETH).
Tesla Records Major Loss Since Investment
Since making substantial investments into bitcoin back in 2021 Tesla has recorded major losses with their most recent regulatory filing reporting over double what it lost back then with an impairment loss of now standing at $204 million for 2022 compared to just over half ($101 million) it lost back in 2021.
Conclusion
Bitcoin remains robust despite suffering huge losses since Teslas initial investment back into the cryptocurrency with some analysts believing there may be a potential rebound as consumer interest grows towards more developed ecosystems such as Ethereum (ETH) and other coins alike