Bitcoin BTC/USD reached new record highs in March 2024, possibly influenced by the upcoming 2024 presidential election.
In this article, we review Tesla’s Bitcoin purchase and its impact on investors.
What Happened: Tesla made headlines in February 2021 by revealing it bought $1.5 billion in Bitcoin in January 2021. This purchase significantly boosted Bitcoin’s price.
During Q1 2021, Tesla sold $272 million worth of Bitcoin, contributing $128 million to its profits. In 2022, they sold 75% of their holdings, bringing in $936 million.
Currently, Tesla lists $184 million in “digital assets” on its balance sheet, likely including Bitcoin and Dogecoin DOGE/USD.
Tesla has indicated it may adjust its digital asset portfolio based on market conditions. Recently, reports suggested Tesla moved Bitcoin into unknown wallets, hinting at a potential future sale.
Bitcoin Investment: Despite a decline in 2022, Bitcoin surged to new highs in 2024, following the approval of Bitcoin ETFs.
On Feb. 8, 2021, Bitcoin peaked at $46,203.93 after Tesla’s announcement, rising from $39,621.84 the day before. A $1,000 investment at that time would be worth $1,468.65 today—a 46.9% increase.
In comparison, a $1,000 investment in Tesla stock would now be worth $758.39, reflecting a 24.2% loss. However, Bitcoin hasn’t outperformed the SPDR S&P 500 ETF Trust SPY, which would be worth $1,491.58 today, up 49.2%.
While Bitcoin has historically done well, Tesla’s purchase day was not one of its best times to invest. Had Elon Musk followed Michael Saylor’s advice to invest in Bitcoin in December 2020, returns could have been even higher.
Bitcoin hit an all-time high of $73,750.07 on March 14, 2024.
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This article has been updated and originally published by Benzinga.
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