Tesla Made All the Crypto Mistakes

Tesla made all of the mistakes when it bought Bitcoin: buy high, sell low, and be loud about it.

Tesla Made All the Crypto Mistakes
Photo by Paul Steuber / Unsplash

In classic crypto newcomer fashion, Tesla made all of the mistakes possible. They bought Bitcoin at a relatively high point in Q1 2022 for approximately $30,000 per BTC. They reportedly sold 10% of that at $32k per BTC for a decent profit, then panic sold 75% when the market dipped resulting in a loss of about $110M.

Since Q1 2022 though, Tesla hasn’t touched crypto. They’re currently holding a modest 10,800 BTC, and have announced no plans to buy or sell. In a previous earnings call for the company, CEO Elon Musk discussed Tesla’s position on Bitcoin and why they were selling:

“We are certainly open to increasing our bitcoin holdings in the future, so this should not be taken as some verdict on bitcoin… It’s just that we were concerned about overall liquidity for the company, given Covid shutdowns in China”

Essentially, Tesla bought more than they could afford to and then panic sold. COVID shutdowns have been an ongoing concern for Tesla, as much of their manufacturing pipeline has been forcibly shut down multiple times now. There have been delays on car deliveries (like all manufacturers have faced), and Tesla recently announced they were delaying an expansion on their Shanghai manufacturing.

Elon has been embroiled in a will-they won’t-they relationship with crypto for years now. He had announced they’d be accepting Bitcoin for Teslas, which the community went crazy over. Then he retracted that. He also somehow became the figurehead for the memecoin Dogecoin. Dogecoin is a fork off an old version of Bitcoin, but instead of being hard money that the Federal reserve can’t print more of at a whim like Bitcoin, it has a dog icon.