Elon Musk Reveals Why He Sold Tesla’s Bitcoins

Charlie Taylor

During Tesla’s earnings call on Wednesday, CEO Elon Musk explained the reason for selling 75% of the company’s bitcoin (BTC) allocations, equivalent to approximately $936 million, as highlighted in his report. of second quarter results.Also Read: Tesla Sells 75% Of Its Bitcoin Reserve For $936 Million“The reason we sold a lot of our bitcoin allocations was that we weren’t sure when the Covid-19 lockdowns in China would ease,” Musk said in the presentation. “So it was important for us to maximize our cash position given the uncertainty of the Covid-19 lockdowns in China.” Although China eased Covid-19 restrictions in major cities in late May, an increase in cases in Beijing and other major regions had the government reimpose regulations a few weeks later. Earlier this month, mass testing and lockdowns were implemented in Shanghai. As a consequence, China’s “covid zero policy” is being put to the test again, prompting new warnings of massive economic hurdles. Reuters reported that the world’s second-largest economy contracted sharply in the second quarter compared to the first in both industrial production and consumer spending.

Tesla may buy more cryptocurrencies in the future

In the presentation, the company explained that Tesla converted much of its bitcoin allocations into “fiat” (fiduciary) for realized gain, earning a $106 million cost of profit and loss included in restructuring expenses related to employee reductions. Despite the liquidation, Musk said Tesla is willing to increase its currency allocations in the future. ).In a subsequent Q&A, Musk said that cryptocurrencies were not something the company thinks about very much and is “a show apart from a show apart” and an afterthought for the company.Musk clarified that the main objective Tesla’s goal is to “accelerate the advent of sustainable energy”.“For us, cryptocurrencies are not that relevant”, he explained.*Translated by Daniela Pereira do Nascimento with authorization from Decrypt.co.\r\n window.uolads.push({ id: \”banner -970×250-area-1\” });\r\n \r\n

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