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Tesla abandons bitcoins


Elon Musk’s electric car company has sold 75% of its Bitcoin holdings

Tesla liquidated about three-quarters of its bitcoins, adding $936 million in cash to its balance sheet, according to the company’s latest earnings report released Wednesday.

“At the end of the second quarter, we converted approximately 75% of our Bitcoin purchases into fiat currency,” the company disclosed in its financial report.

The clearance sale “should not be taken as a verdict on Bitcoin”, CEO Elon Musk emphasized during a call with Tesla investors on Wednesday. He explained that this decision was necessary to maximize the cash position and increase liquidity in the middle of the “the uncertainty of Covid lockdowns in China” at the time.

Tesla invested a total of $1.5 billion in Bitcoin in the first quarter of 2021, according to previous filings, becoming the second-largest cryptocurrency holder in the corporate world, according to analytics firm CoinGecko. . The company even announced that it would accept Bitcoin as payment for its cars, but Musk abruptly reversed his decision two months later, citing environmental concerns.

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“We haven’t sold any of our Dogecoin”, Musk reassured investors, adding that despite an estimated $106 million liquidation impact, Tesla remains open to increasing its cryptocurrency holdings in the future.

Overall, the Austin, Texas-based company reported better-than-expected net profit of $2.26 billion for the quarter, as its shares rose 1.5% to $753.40 in the quarter. the negotiation extended on Wednesday.

At the same time, Bitcoin fell to nearly $23,000 on the news, but rebounded somewhat after Musk’s explanation. The billionaire’s decisions and statements have influenced the value of Bitcoin, Dogecoin and other cryptocurrencies many times in the past, with some crypto investors accusing him of manipulating the market with his Twitter posts.


RT

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