Tesla, the renowned electric vehicle manufacturer, experienced a significant gain of $600 million from its Bitcoin holdings in the fourth quarter of 2024. This increase was largely attributed to recent changes in accounting rules which now allow companies to register the market value of their digital assets. According to crypto executives, this new rule presents untapped opportunities for businesses who want to use their digital assets as collateral in order to produce working capital.
In January 2021, Tesla’s venture into digital assets began with the purchase of $1.5 billion worth of Bitcoin. Despite the mix of praise and backlash from the investment circle, this move set a precedent for other companies. Although Tesla subsequently sold over 70% of its Bitcoin investment, data from Arkham Intelligence shows that it still houses 11,509 BTC, valued at approximately $1.1 billion currently.
Elon Musk, Tesla’s CEO, originally sold BTC with the intention of demonstrating the asset’s liquidity and reinforcing the company’s balance sheet during uncertain times. However, this decision resulted in the company missing out on billions in capital gains. If Tesla still possessed its initial purchase of 39,474 BTC to date, with Bitcoin’s price exceeding $97,000, the value of their Bitcoin holdings would stand close to $3.8 billion.