Bitcoin BTC/USD recently reached new all-time highs as March 2024 approaches, especially with the 2024 presidential election on the horizon.
This article looks back at Tesla Inc TSLA and its Bitcoin purchase, highlighting potential gains for investors.
Purchase Details: MicroStrategy was the first major company to buy Bitcoin in 2020, but Tesla followed with a $1.5 billion Bitcoin purchase in January 2021, announced to investors on February 8, 2021. This news pushed Bitcoin’s price higher.
Tesla later sold $272 million of its Bitcoin in Q1 2021, positively impacting its profits. In 2022, Tesla sold 75% of its Bitcoin, generating $936 million.
Currently, Tesla reports $184 million in “digital assets,” potentially including both Bitcoin and Dogecoin DOGE/USD.
Tesla stated it could change its digital asset holdings at any time, depending on needs and market views. Recently, reports suggested Tesla moved its Bitcoin to unknown wallets, possibly hinting at another sale.
Bitcoin Performance: Bitcoin initially fell in 2022 due to economic challenges and events like the FTX bankruptcy. By March 2024, Bitcoin hit a new high following Bitcoin ETF approvals, driving institutional investments.
After Tesla’s purchase announcement, Bitcoin rose from $39,621.84 to $46,203.93 on February 8, 2021. A $1,000 investment then would now be worth $1,468.65 (up 46.9%). In contrast, $1,000 in Tesla stock would be worth $758.39 (down 24.2%).
However, Bitcoin hasn’t outperformed the SPDR S&P 500 ETF Trust SPY, which would be worth $1,491.58 today (up 49.2%). This indicates S&P 500 investments were more profitable than Bitcoin since Tesla’s announcement.
Many investors have done well with Bitcoin over time, but those who followed Tesla’s move did not see similar success immediately. Michael Saylor, co-founder of MicroStrategy, previously urged Elon Musk to invest in Bitcoin in December 2020, which could have provided much greater returns.
Bitcoin reached a record high of $73,750.07 on March 14, 2024.
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This article was previously published by Benzinga and has been updated.
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