Electric vehicle giant Tesla revealed an interesting note in its recent Q2 2023 earnings release. Once an active participant in the cryptocurrency markets, the company has refrained from buying or selling any bitcoin for four consecutive quarters. A firm stance that undeniably sparks curiosity among crypto enthusiasts.
Their untouched stash of digital assets remains at $184 million – a number consistently maintained for the past three quarters. With bitcoin priced at roughly $30,400 at the end of the second quarter, up from about $28,500 at the end of the first, one might question why the company’s digital assets valuation didn’t show any surge. It’s a confounding labyrinth called accounting rules, which permits the decrease of asset valuation when prices dip, regardless of a sale, but doesn’t allow for an increase unless the assets are sold.
The last significant shuffle in Tesla’s bitcoin treasury was during the second quarter of the previous year. That was when it offloaded around 30,000 bitcoins, then about 75% of its holdings, realising $936 million. This move followed their initial mammoth acquisition of $1.5 billion worth of bitcoin in early 2021, spurred by CEO Elon Musk‘s declaration of accepting bitcoin as a payment for their cars.
The company’s financial health, however, seemed to display vigour, with adjusted earnings per share of $0.78 narrowly missing consensus analyst estimate of $0.80 according to FactSet, but overall revenue of $24.9 billion managed to eclipse analyst expectations of $24.2 billion. The market appeared relatively unaffected by the earnings call with shares edging 1% to $288.96 in after-hour trading and an impressive cumulative annual rise of over 136%.
The no-action manoeuvre of Tesla in the cryptosphere, while somewhat perplexing, underpins a broader question. Is their conservative approach a carefully calculated decision derived from the inherent volatility of the crypto landscape or just a lull before another bold move? The company remains silent. Meanwhile, the relentless world of crypto continues with its orchestra of booms, crashes and surprises. Both believers and sceptics eagerly watch the unfolding narrative, looking for hints of what the next steps of influential market participants may be.
Source: Coindesk
