What Were The Implications Of Tesla's Decision To Invest In Bitcoin?

In comparison to Tesla’s stock price, the value of Bitcoin (BTC) has exploded in the last five years. There has been a 1,180% increase in the price of Bitcoin and an 806% increase in the shares of Tesla, according to statistics from TradingView.

Over shorter horizons, Bitcoin has also beaten Tesla’s returns. Just a year ago, the value of Bitcoin grew to 139%, while the value of Tesla stocks decreased by more than 11%. On the other hand, since the beginning of the year, Tesla’s share price has been down by 42%, while Bitcoin is up by 49%.

Thanks to its phenomenal success, Bitcoin market capitalization has reached $1.3 trillion, becoming the 9th largest asset in the world. In contrast, Tesla is the world’s 21st-largest asset by market value, with a value of $455 billion.

Tesla buying more than $1.5 billion worth of BTC in February 2021, Tesla joined the ranks of the first publicly traded companies that had done so. However, the company did sell some 10% of its Bitcoin holdings in March 2021 and some 75% in the second quarter of 2022.

By not selling its bitcoin, Tesla would have ended up with more than $1.27 billion, a return of over 84% over its original investment. Tesla now has 11,509 BTC, worth more than $766 million with Coinbase Prime Custody.