Elon Musk’s electric vehicle (EV) company Tesla held $1.5 billion (roughly Rs. 11,200 crore) in Bitcoins by the end of last year, the company revealed in an official filing with US Securities and Exchange Commission (SEC). Owing to the losses that hit the crypto asset last year, Tesla lost $101 million (roughly Rs. 755 crore) in impairment losses, the filing also showed. Musk has been a staunch supporter of cryptocurrencies, specifically the meme-based Dogecoin, rallying its prices to great heights last year.
In 2021, Tesla had listed Bitcoin as a payment option but quickly withdrew the feature citing environmental concerns linked with the cryptocurrency’s mining. Tesla has said that in the future also, it could moderate its holdings of digital assets based on business scenarios and environmental urgencies.
“We believe in the long-term potential of digital assets both as an investment and also as a liquid alternative to cash,” the SEC filing said.
Despite listing it as a payment mode for Tesla, Musk has often said that Bitcoin resembled a long-term investment option to him rather than an every-day payment option.
The multi-billionaire rather supports Dogecoin as a transactional cryptocurrency. In December last year, Tesla announced that customers would be able to purchase a select range of its merchandise with DOGE.
Musk is also known to have been in the process of integrating DOGE payments with Tesla car purchases under the pseudo name “SHIBA” but there has been no reported development on this front since December last year.
Despite market volatility and uncertainty in regulatory laws, the company has kept the avenues of re-introducing crypto payments for its product and services later, open.
“Digital assets are considered indefinite-lived intangible assets under applicable accounting rules. Accordingly, any decrease in their fair values below our carrying values for such assets at any time subsequent to their acquisition will require us to recognise impairment charges, whereas we may make no upward revisions for any market price increases until a sale. For any digital assets held now or in the future, these charges may negatively impact our profitability in the periods in which such impairments occur even if the overall market values of these assets increase,” the filing added.
Overall, Tesla gained $27 million (roughly Rs. 200 crore) in its crypto transactions during the year and recorded it as a negative loss in restructuring and other expenses.