Bitcoin (BTC/USD) reached new highs in March 2024, possibly rising further before the 2024 presidential election.
Here’s a recap of Tesla Inc’s (TSLA) investment in Bitcoin and how investors could benefit by following their lead.
What Happened: While MicroStrategy was the first to add Bitcoin to its balance sheet in 2020, Tesla made a significant purchase of $1.5 billion in January 2021, announced on February 8, 2021. This helped boost Bitcoin’s price, seen as a major boost for cryptocurrency.
Tesla sold $272 million of Bitcoin in Q1, contributing positively to its quarterly profits. In 2022, it sold 75% of its Bitcoin holdings for $936 million.
Currently, Tesla lists $184 million in digital assets on its balance sheet, which likely includes Bitcoin and Dogecoin (DOGE/USD), used for online purchases.
Tesla has stated it may adjust its digital asset holdings based on market conditions and business needs. Recent reports suggest it may move its Bitcoin to unknown wallets, hinting at a potential sale.
Investing $1,000 in Bitcoin during its peak on February 8, 2021, would have bought you approximately 0.0216 BTC, now worth about $1,468.65—a 46.9% gain. In contrast, a $1,000 investment in Tesla would amount to $758.39, losing 24.2% over the same period.
Bitcoin outperformed Tesla stock but not the SPDR S&P 500 ETF Trust (SPY), which grew to $1,491.58—a 49.2% increase. Hence, investing in the S&P 500 would have been more profitable than investing in Bitcoin for that time frame.
Although Bitcoin has shown strong performance overall, Tesla’s purchase announcement didn’t yield the best returns compared to top stocks and their indexes.
If Elon Musk had heeded MicroStrategy’s advice in December 2020 to invest in Bitcoin, Tesla may have seen even greater returns.
Bitcoin reached an all-time high of $73,750.07 on March 14, 2024.
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This article was republished by Benzinga with updates.
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