Elon Musk stated his Tesla Inc has told 10 per cent of its Bitcoin holdings to prove the liquidity of the cryptocurrency. Elon Musk clarified that he has not sold any of his personal bitcoin, retaining his individual investment. Tesla CEO Musk was responding to a tweet from Dave Portnoy, an American net celebrity blogger, who claimed that Musk purchased the Bitcoin, pumped it, and then dumped it to make a fortune. Elon Musk on Twitter stated that Tesla sold 10 per cent of its holdings basically to prove liquidity of Bitcoin as an option to holding money on the balance sheet.
“Am I understanding this correctly? Elon Musk buys bitcoin. Then pumps it. It goes up. Then he dumps it and makes a fortune,” Dave Portnoy stated in a tweet. Elon Musk replied to the tweet saying: “No, you do not. I have not sold any of my Bitcoin. Tesla sold 10% of its holdings essentially to prove liquidity of Bitcoin as an alternative to holding cash on balance sheet”.
Earlier this week, Tesla in its earnings report stated that quarter-finish money and money equivalents fell to $17.1 billion in the very first quarter, driven primarily by a net money outflow of $1.2 billion in cryptocurrency (Bitcoin) purchases, net debt and finance lease repayments of $1.2 billion, partially offset by the absolutely free money flow of $293 million. During mid-April this year, Bitcoin surged to a record higher of $64,870. The world’s biggest cryptocurrency was up more than 3.8 per cent to $54,583.87, according to the information on CoinDesk. On a year-to-date (YTD) basis, Bitcoin has surged 88.41 per cent. While Tesla Inc’s share value rose 1.21 per cent to close at $738.2, assisting the Tech-heavy Nasdaq Composite to close at a record higher level in overnight trade.
Zachary Kirkhorn, Chief Financial Officer, Tesla, stated that firm invested $1.5 billion in bitcoin for the duration of the quarter, then trimmed its position by 10%, which contributed to a modest get in its very first-quarter financials. During the very first quarter of 2021, Tesla reported a net revenue of $438 million. “In some years we may grow faster, which we expect to be the case in 2021. The rate of growth will depend on our equipment capacity, operational efficiency and capacity and stability of the supply chain,” Tesla stated in its earnings report. Tesla reported total income development of 74 per cent on-year in the very first quarter of 2021.
In a filing with the US Securities and Exchange Commission in February this year, Tesla stated it purchased the bitcoin for more flexibility to additional diversify and maximize returns on its money. Tesla also stated that the firm will start out accepting payments in bitcoin in exchange for its merchandise, topic to applicable laws and initially on a restricted basis.