- Tesla lost $204 million in 2022 after the Bitcoin price dropped
- The carmaker also disclosed a loss of $101 million from digital assets in 2021
Electric carmaker Tesla announced plans to sell its vehicles for Bitcoin in February 2021, pushing the flagship crypto’s price up markedly. The company also bought $1.5 billion worth of Bitcoin. At that time, one BTC was trading for approx. $43,000.
The price of Bitcoin reached an all-time high at the end of the year, in part due to Tesla CEO Elon Musk’s ardent support of these digital assets.
The crypto winter changed everything
Then came crypto winter, or crypto ice age as some have called it. One BTC is worth just over $23,000 in February 2023, down by more than 50% since the all-time high.
Tesla lost $204M from Bitcoin in 2022
Tesla stated in a report filed with the US Securities and Exchange Commission that they lost $204 million in 2022 after the price dropped. In the report, this was termed “impairment loss,” a concept which refers to a loss or decline in the value of an asset.
In its filing, the carmaker also disclosed an impairment loss of $101 million from digital assets in 2021. The total impairment losses thus come to $305 million. Tesla recorded gains of $64 million and $128 million in 2022 resp. 2021.
Tesla’s losses have doubled in two years
Tesla was an early Bitcoin adopter and made substantial investments in the crypto. The carmaker stopped accepting Bitcoin payments in May 2021 as Musk backtracked over its high energy usage. Since 2021, Tesla’s impairment losses have almost doubled. This was despite data from a 2021 SEC filing showing the company gained $128 million from selling Bitcoin that year.
Hope remains for the market
Many market analysts think Bitcoin will rebound and remains solid even though it has now lost about 70% of its value. Traders have become fearful of the crypto market in general and are embracing Bitcoin, Ethereum, and well-developed ecosystems in general.
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