Tesla (TSLA), an Electric Vehicle company owned by Elon Musk, has 11,900 BTC worth around $1.2 billion. Arkham Intelligence revealed the latest estimates after analysing blockchain data. Tesla first announced its strategy to buy Bitcoin in Q1 2021. In a Securities and Exchange Commission (SEC) filing, on February 8, 2021, Tesla reported the purchase of 43,200 BTC worth around $1.5 billion. At the time, Tesla introduced various measures to incorporate Bitcoin into the company, such as an option to pay for EV cars with BTC. However, Tesla abandoned this option when there were concerns regarding Bitcoin’s use of proof-of-work methods that negatively impact the environment. In May 2021, the option to buy Tesla cars with Bitcoin was removed. Tesla employs Coinbase Prime Custody to handle its large Bitcoin treasury. The company has been interested in cryptocurrencies for some time, but has had to reconsider some use cases due to the ongoing concern regarding Bitcoin’s use of fossil fuels. Tesla aims to promote EV cars to support sustainable practices. Bitcoin’s proof-of-work algorithm relies on large amounts of electricity, which still depend on fossil fuels and coal production. There is speculation that Musk will integrate tokens such as Bitcoin and Dogecoin into his businesses. Musk bought $1.5 billion Bitcoin in 2021, but had to sell many of the tokens to pay for expenses. Musk may be reconsidering his sales due to the increasing wealth that crypto adds to his balance sheet. On April 22, Tesla revealed that it owned 11,509 BTC, worth around $1.05 billion on its balance sheet. However, due to the current rise in price and an all-time high (ATH) of $111,000 for Bitcoin, Tesla’s holdings have gone up to around $1.2 billion. Tesla may have missed many opportunities due to its back-and-forth policy regarding digital assets. For example, in March 2021, Tesla added the option to buy electric cars with Bitcoin. However, the EV maker flip-flopped in May 2021 because of concerns that Bitcoin was reversing the positive aspects of Tesla due to its reliance on fossil fuels. Further, during Q1 2021, Tesla sold 10% of its Bitcoin holdings, making a $272 million profit. Then Tesla sold 75% of its remaining Bitcoin in Q2 2022, leaving only 9,720 BTC in its treasury. Elon Musk said that he sold Bitcoin because the company needed the money. However, if Musk held onto the 43k BTC, the company would have nearly $5 billion worth of Bitcoin. Other companies also hold Bitcoin treasuries, which can be compared to Tesla’s approach. Strategy holds 576,230 BTC and made its latest purchase of 7,390 BTC on May 19 for around $764 million. With a Bitcoin price of $111,000, Strategy would own around $63 billion. Metaplanet, a Tokyo-listed company, also creates a large Bitcoin treasury. Metaplanet recently added 1,004 BTC to its treasury, falling short of 2,000 BTC from its target of 10,000 BTC. Governments are also interested in Bitcoin treasuries. President Trump has approved a Bitcoin treasury that uses seized assets from federal investigations. Meanwhile, at the state level, New Hampshire and Texas have approved local treasuries, further boosting the popularity of cryptocurrencies. The Financial Accounting Standards Board (FASB) changed the rules regarding digital asset holdings. Many investors complained because the old rules required a public company to use cost accounting methods to list crypto assets. The problem with cost accounting methods is that the crypto assets are listed at their bought price and are changed if the asset drops in value, which may severely undervalue the asset. The new changes allow companies to report the fair value of their digital assets. For example, when Tesla bought Bitcoin at $30k, the company reported the value of each Bitcoin at $30k. When the price fell to $15k, Tesla reported the value of each Bitcoin as $15k. However, when Bitcoin bounced back up in value, Tesla continued to report that it had a value of $15k. In fact, from 2022 to 2024, Tesla reported the same amount of $184 million in Bitcoin holdings, despite a price change.
