The unofficial ambassador of Dogecoin is in the news for selling off 75% of Tesla’s BTC holdings. In an investor call, Elon cited that the firm has sold only a significant stake of Bitcoin but holds Dogecoin entirely.
In his previous interactions with the media, he mentioned that his personal investments consist of Dogecoin but he didn’t reveal that Tesla holds any Doge even though it accepts Doge for online merchandise purchases. It’s not clear if Tesla has made institutional investments in Dogecoin that Elon supports assertively on Twitter. The firm disclosed that it holds $218 million worth of VDAs’ after selling off a major stake of BTC worth $963 million.
Read more: Tesla Sells 75% of Bitcoin Holdings
On the Investors’ call, Musk added that Tesla sold its BTC holdings to accrue cash liquidity as the covid shutdowns in China are quite unpredictable. He also added that his Bitcoin sell-off should not be taken as a bearish move or a negative verdict on the crypto market, seldom the king asset itself. The company has $2.26 billion in profit this quarter but is facing challenges with the supply chain and has decreased its EVM production noticeably.
In 2021, Elon mentioned that He would pump into crypto assets but not dump them to drive up the price. He said he wishes to see Bitcoin succeed. Musk was hit with a $258 billion lawsuit for racketeering Dogecoin’s price. To this Musk commented that He will keep buying Dogecoin and shunned the claims pointed at him.
Tesla owned 42,000 Bitcoins in the second quarter and after selling 75% of its stake, the remainder BTC could be around 10,500 at the end of the quarter. With a quick glance over the numbers and applying math, the holdings earned by Tesla in Doge is sizeable if not huge.
Another factoring reason for Tesla liquidating Bitcoin was the fact that Doge’s price has surged despite the Twitter deal dispute. Connecting the dots, Tesla accepts Doge for selected online merchandise, it isn’t rocket science to determine that the firm is bullish in Doge and has been lending support for mass adoption of the meme coin.
The relationship of Elon with crypto has been quite contradictory. He announced that Tesla will accept Bitcoin for purchases. The offer stood only for 49 days after Musk realized that the crypto asset consumes a lot of energy. He mentioned that Crypto is a great idea at many levels and has a promising future but not at the cost of depleting precious fossils and harming the environment.
According to research done by TRG Datacenters, Doge is also energy-intensive proof of work crypto but does not consume energy as much as Bitcoin does. With Musk’s conversations with Twitter, it was speculated that many transactions of Twitter would move from PayPal to Doge.
To summarise the Tesla -Bitcoin and Doge situation, it seems that the inflation rate has left a domino effect on the best EV firm as well, With cash flow liquidity and the ongoing pandemic situation in some parts of the world are forcing the economies to collude.
Source: Nasdaq, The Verge
Additional Read: Top Crypto Prices Today