Tesla Blames Selling 75% of Their Bitcoin on Covid

In an earnings call that occurred yesterday, Tesla revealed that it had sold 75% of its Bitcoin holdings, worth around $936 million, as was reported by its Q2 earnings.

Tesla CEO Elon Musk explained the decision by saying "The reason we sold a bunch of our Bitcoin holdings was that we were uncertain when the COVID lockdowns in China would alleviate," Musk said on the call. "So it was important for us to maximize our cash position, given the uncertainty of COVID lockdowns in China."

China is said to have eased Covid restrictions in all its major cities back in May, but a spike in cases in the area of Beijing and other key places prompted the government to bring back certain ordinances just a couple of weeks after. Just earlier this month widespread lockdowns and testing were administered in Shanghai.

Due to these decisions China's “zero COVID policy” is once again being put through the wringer, leading to new reports of potential financial disaster for its economy. Reuters is reporting that the world's second-largest economy failed to meet its previous quarter's numbers, in both commercial output and consumer spending.

During the earnings call, Tesla claimed to have exchanged its Bitcoin holdings for a $106 million profit. Although the company sold this time out, it claims that it does not rule out a future where they reincrease their holdings of the coins.

"This should not be taken as some verdict on Bitcoin," he said, as well as sliding in there that they had not sold any of his precious Dogecoin.

During the Q and A Musk stated that crypto was "a sideshow to the sideshow” , and that the company's main focus reins elsewhere.

"We're neither here nor there on cryptocurrency," he said.

Mr. Musk has been a rambunctious figure within the industry for the past two years, with his first proposal for Tesla to buy Bitcoin being the black powder to ignite its price back in April of 2020. As well as being the needle to Bitcoins ballooned price in May of 2021, when he announced the company has sold some of its shares, bought just a year prior, leading to a steep decline.

Elon's intentions have never been clear, with those who defend him saying his well-meaning attitude coupled with his business prowess, could only benefit the space, but as these past couple of years have shown, Elon is here for Elon, though this does not rule out a comeback for him within the industry. .