That figure represents a healthy gain of 33% from the $1.5 billion it spent on buying the asset earlier that year. The carrying value of Tesla’s Bitcoin holdings at the end of 2021 was $1.26 billion, and their market value was $1.99 billion.
Bullish on Bitcoin
Tesla is among the few publicly listed companies with Bitcoin on its balance sheet. Its CEO Elon Musk has long been bullish on Bitcoin, an asset whose price breached new price highs during the pandemic.2 The company also accepts bitcoin for purchases of certain products on its website.
As Bitcoin’s price reached stratospheric heights, culminating in a high of almost $68,000 in April 2021, Tesla sold some of its Bitcoin stash for $272 million and collected a profit of $128 million from the transaction. A subsequent drawdown in crypto prices forced the company to record impairment charges—losses in the value of its holdings—in successive quarters. It recorded impairment charges of $51 million and $23 million during the third and second quarters of 2021.34 The recent filing revealed that Tesla had total impairment charges of $101 million related to Bitcoin in all of 2021.