Tesla has recorded approximately $600 million in Bitcoin gains as the value of the premier crypto asset continues to rise.
The electric vehicle manufacturer, headquartered in Texas, currently holds 11,509 BTC, with a market value of approximately $1.13 billion. This has remained unchanged since June 2022.
Over the past few months, Bitcoin has maintained an upward trend, reaching $109,000 during its peak. At press time, BTC is hovering around $98,279. Amid this upswing, Tesla’s Bitcoin profits have improved.
Tesla’s Latest Accounting Report
Specifically, Tesla’s latest quarterly statement reported a $589 million gain from its Bitcoin holdings, totaling $1.076 billion in value, up from $184 million in previous quarters.
This reported gain resulted from a new accounting rule allowing companies to record their crypto holdings’ market value. In particular, the rule enables companies to reflect the market value of crypto on their balance sheets, preventing their assets from being undervalued if crypto prices rise.
Tesla’s overall GAAP income for Q4 2024 was $2.3 billion, and Bitcoin contributed approximately $600 million.
Tesla’s Bitcoin Portfolio Growth
These gains are notable, especially since the automotive firm has not purchased any Bitcoin since 2022. The company’s latest movements occurred four months ago, involving the distribution of Bitcoin to new wallets.
Notably, Tesla has also sold more than 70% of its original Bitcoin holdings, missing out on further capital appreciation.
For context, the firm initially entered the Bitcoin market on January 25, 2021, when the cryptocurrency’s price hovered above $32,000. At the time, it accepted Bitcoin payment for electric vehicle purchases.
New Accounting Rules
It is crucial to note that regulatory changes have impacted Tesla’s Bitcoin reporting practices. The Financial Accounting Standards Board (FASB) has approved Fair Value Accounting for Bitcoin, effective for fiscal years beginning from December 15, 2024.
These new standards enable corporations to list digital assets based on real-time market value. Watchers say this may encourage firms to use crypto holdings as collateral for working capital.
FASB has officially adopted Fair Value Accounting for #Bitcoin for fiscal years beginning after Dec 15, 2024. This upgrade to accounting standards will facilitate the adoption of $BTC as a treasury reserve asset by corporations worldwide. https://t.co/4GOuji6cr0
— Michael Saylor⚡️ (@saylor) December 13, 2023
Tesla CEO’s Blockchain Endorsement
Notably, Tesla’s CEO Elon Musk has maintained an interest in blockchain technology, building on his previously endorsing digital assets such as Dogecoin. Beyond corporate holdings, the executive’s blockchain engagement has expanded to government-related initiatives.
As head of the Department of Government Efficiency (DOGE), a newly formed federal agency, Musk has publicly advocated for placing U.S. Treasury transactions on the blockchain.
A recent online post addressed concerns about regulatory compliance within the Department of the Treasury. Following these statements, a digital asset entrepreneur suggested utilizing blockchain to enhance transaction transparency. In response, the Tesla CEO supported the idea, reinforcing his stance on leveraging blockchain for governmental financial oversight.
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