Invested $1,000 in Bitcoin when Tesla did? See your gains

Bitcoin BTC/USD reached new highs in March 2024, potentially rising more before the 2024 presidential election.

Let’s revisit Tesla Inc’s TSLA Bitcoin purchase and the returns for investors who followed their move.

What Happened: While MicroStrategy started adding Bitcoin to its portfolio in 2020, Tesla made a significant purchase of $1.5 billion in January 2021, announced on February 8, 2021. This purchase boosted Bitcoin’s price significantly.

Tesla later sold $272 million worth of Bitcoin, impacting its quarterly profit positively. In 2022, they sold 75% of their holdings for $936 million.

Tesla currently shows $184 million in “digital assets,” possibly including Bitcoin and Dogecoin DOGE/USD, which can be used for purchases on their online store.

Tesla mentioned that it could change its digital asset holdings based on business needs and market views. Recent reports suggested they may be moving Bitcoin to different wallets, hinting at a possible sale.

Here’s how Bitcoin has performed since Tesla’s acquisition:

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Investing $1,000 in Bitcoin: Bitcoin faced declines in 2022 due to economic issues and the collapse of FTX. However, it surged again to record highs in March 2024 after Bitcoin ETFs gained popularity.

Following Tesla’s purchase, Bitcoin rose to $46,203.93 on February 8, 2021. A $1,000 investment then could have bought 0.0216 BTC, now worth $1,468.65—representing a 46.9% gain.

On the other hand, a $1,000 investment in Tesla stock would be worth $758.39, a 24.2% loss. Compared to the SPDR S&P 500 ETF Trust SPY, which would be worth $1,491.58 today (up 49.2%), Bitcoin didn’t outperform this index during the same period.

Although Bitcoin has triumphed over many stocks and indexes overall, that wasn’t the case right after Tesla’s purchase.

MicroStrategy co-founder Michael Saylor had suggested that Tesla invest cash in Bitcoin back in December 2020. If Tesla had acted then, returns would have been better for both Tesla and its investors.

As of March 14, 2024, Bitcoin reached an all-time high of $73,750.07.

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This article was previously published by Benzinga and has been updated.