Bitcoin BTC/USD reached new highs in March 2024, possibly influenced by the upcoming 2024 presidential election.
This recap highlights Tesla Inc’s Bitcoin purchase and the potential gains for investors.
Background: Although MicroStrategy was the first to buy Bitcoin in 2020, Tesla followed suit in January 2021, announcing a $1.5 billion purchase on February 8, 2021. This triggered a significant price jump for Bitcoin.
Tesla later sold $272 million worth of its Bitcoin in Q1, benefiting its profitability by $128 million. By mid-2022, Tesla had sold 75% of its Bitcoin, generating $936 million in cash.
Currently, Tesla lists $184 million in “digital assets” on its balance sheet, possibly including Bitcoin and Dogecoin DOGE/USD. The company indicated it could adjust its cryptocurrency holdings as needed.
Recently, Tesla moved Bitcoin to unknown wallets, possibly signaling another sale.
Bitcoin Investment: After a decline in 2022, Bitcoin soared again in 2024 following Bitcoin ETF approvals and increased institutional interest.
After Tesla’s announcement, Bitcoin’s price rose to $46,203.93 on February 8, 2021. A $1,000 investment at that time could have purchased 0.0216 BTC, now worth $1,468.65—up 46.9%.
In contrast, a $1,000 investment in Tesla stock would have dropped to $758.39, and in the SPDR S&P 500 ETF Trust SPY, it would have grown to $1,491.58—up 49.2%.
While Bitcoin generally outperformed stocks and indices, the day of Tesla’s Bitcoin purchase was not the best benchmark.
MicroStrategy co-founder Michael Saylor suggested Musk invest in Bitcoin back in December 2020. Doing so would have likely yielded greater returns.
Bitcoin reached an all-time high of $73,750.07 on March 14, 2024.
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Originally published by Benzinga, updated for clarity.
Market News and Data by Benzinga APIs
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