Bitcoin BTC/USD reached new highs in March 2024, possibly rising further before the 2024 presidential election.
This article reflects on Tesla Inc TSLA‘s Bitcoin purchase and potential gains for investors.
Background: While MicroStrategy was the first to add Bitcoin to their balance sheet in 2020, Tesla made headlines with a $1.5 billion Bitcoin purchase in January 2021, announced on February 8, 2021.
This purchase greatly influenced Bitcoin’s price, marking a significant moment in cryptocurrency history.
In Q1 2021, Tesla sold $272 million of its Bitcoin, positively impacting its profits with $128 million in returns.
By 2022, Tesla had sold 75% of its Bitcoin for $936 million in cash.
Currently, Tesla lists $184 million in “digital assets,” likely including Bitcoin and Dogecoin DOGE/USD. Tesla may adjust its cryptocurrency holdings based on market conditions.
Recently, there were reports of Tesla moving its Bitcoin to various wallets, which may indicate a future sale.
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Investing $1,000 in Bitcoin: Despite a drop in 2022 due to various market issues, Bitcoin reached new heights in March 2024 after Bitcoin ETFs gained approval.
Bitcoin surged to $46,203.93 on February 8, 2021, following Tesla’s announcement. A $1,000 investment then would now be worth $1,468.65, a 46.9% increase.
In contrast, a $1,000 investment in Tesla stock would now be worth $758.39, down 24.2% over the same period.
However, Bitcoin hasn’t outperformed the SPDR S&P 500 ETF Trust SPY, which stands at $1,491.58 today, showing a 49.2% gain.
Overall, while Bitcoin has outperformed many stocks and indexes over time, it underperformed on the day of Tesla’s announcement.
MicroStrategy’s co-founder Michael Saylor had urged Tesla CEO Elon Musk to invest in Bitcoin in December 2020. If implemented earlier, Tesla would have seen greater returns.
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.
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