Tesla spent $1.5 billion last year in Bitcoin. This was to capitalize on the ‘long-term’ potential of , an electric car manufacturer. Three-quarters of the company’s holdings have been sold.

In its second-quarter earnings report, Tesla stated that 75% of Bitcoin purchases had been converted into fiat currency by Wednesday’s end. According to the company, those sales have added $936 million to its cash balance.

It’s a swift retreat for Tesla CEO Elon Musk. He was a strong crypto booster last year, often tweeting to discuss various digital currencies. In the last four months, bitcoin’s value has fallen half of its value during what’s been called a “crypto winter”.

The fair market value for Tesla’s bitcoin holdings was $2.48 Billion in the first half of 2021. It ended the year at approximately $2 billion. Although the company did not specify the price at which it sold its bitcoin holdings or the extent of its impairment, bitcoin was close to $46,000 at the beginning and ended at $19,000 at the end of the second quarter.

Analyst Brian Johnson from Barclays predicted that Tesla would suffer a $460m bitcoin-related impairment following the saleoff.

Musk stated that the reason why we sold some of our bitcoin holdings was because we weren’t sure when the Covid lockdowns would end in China. Therefore, it was important to maximize our cash position. He said that this should not be taken as a verdict on bitcoin and that Tesla is open for future growth.

Musk, however, said that bitcoin’s potential to be an inflationary hedge during the earnings call and stated that Tesla’s primary goal is to accelerate transition to sustainable energy. He called bitcoin ‘a sideshow’.

The company stated that it was about becoming more flexible and diversifying its cash holdings. As the currency soared, the company quickly sold 10%, generating $101 million profit.

Kirkhorn stated that the company was looking to ‘hold what we have long-term and continue to accumulate Bitcoin through transactions from customers as they buy vehicles.

Musk stated that Tesla would cease accepting bitcoin as payment for car purchases in May last year. However, he also said that the company ‘will never sell any bitcoin. Musk tweeted emojis to indicate that the company had ‘diamond hands’ when it comes bitcoin investing a week later. He also credited ‘our master coin’