Leading cryptocurrency Bitcoin (CRYTPO: BTC) hit all-time highs in 2021, a year that saw many exciting events for the cryptocurrency.
One of the big stories in 2021 was large companies adding Bitcoin to their balance sheets.
Here’s a look back at when Tesla Inc (NASDAQ:TSLA) bought Bitcoin and how much investors could have made following the electric vehicle giant’s lead.
What Happened: On Feb. 8, 2021, Tesla disclosed it had purchased $1.5 billion worth of Bitcoin, a move that was made in the first quarter in the month of January.
The announcement that Tesla had bought Bitcoin led to an immediate lift in the price of Bitcoin and to experts who saw it as a key catalyst and support for the future of cryptocurrency.
Ark Invest CEO Cathie Wood had previously said companies that added Bitcoin to their balance sheets were one of the reasons for her huge price target for Bitcoin in the future.
Tesla’s purchase of Bitcoin came after companies like MicroStrategy Inc (NASDAQ:MSTR) and Block Inc (NYSE:SQ) had bought the cryptocurrency. Given Tesla’s size and the influence Tesla CEO Elon Musk has, the purchase was widely recognized as a major catalyst.
Tesla later announced it sold $272 million of its Bitcoin in the first quarter, which it said had a “positive impact” on its quarterly profitability with $128 million in proceeds from Bitcoin.
In fiscal 2022, Tesla announced the sale of 75% of its Bitcoin during the second quarter, bringing in $936 million in cash to its balance sheet.
While Tesla has sold most of its original Bitcoin purchase, the company still holds $184 million in “digital assets” on its balance sheet as of the third quarter. This total could include Bitcoin and other cryptocurrencies such as Dogecoin (CRYPTO: DOGE), which it has accepted as a payment option for merchandise before.
In March 2021, Tesla also began accepting Bitcoin as a form of payment for Tesla vehicles, a move that was short-lived.
“You can now buy a Tesla with Bitcoin,” Musk announced on March 24, 2021.
Musk said that Tesla would hold the Bitcoin and not convert the payments to fiat.
Two months later, Tesla stopped accepting Bitcoin as a form of payment for its vehicles. Musk would later state that one of the reasons for the stoppage was due to the energy consumption Bitcoin mining requires.
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