Tesla ($TSLA) began to invest in Bitcoin and accept Bitcoin in 2021. They have announced the aggregate price value of their Bitcoin holdings, but Tesla and representatives have not publicly disclosed their purchase price or their total holdings in BTC. In this article, we investigate and discuss Tesla’s treasury allocation into Bitcoin and make some estimates as to the quantity and purchase price.
Tesla Treasury Bitcoin Dominance
On February 8, 2021, Tesla announced that they had invested a portion of their cash reserves into Bitcoin. Tesla’s Bitcoin investment started at 7.5% of their total cash reserves, an aggregate price $1.5B dollars of Bitcoin.
After a ~75-day price appreciation of 81.3%*, Tesla’s treasury Bitcoin dominance was around 13.9%**.
After the $272M sale which captured a net price appreciation of 59%, Tesla’s treasury Bitcoin dominance was around 12.6%***.
- $2.72B/$1.5B, according to Musk’s comment that $272M was 10%*
- $2.72B/$19.589B cash reserves plus Bitcoin total value**
- $2.48B/$19.589B cash reserves plus Bitcoin total value***
How Many Bitcoin Does Tesla Own?
In early January, Tesla changed their policy to make digital asset purchases possible. This decision was not likely made without specific intention to act. Tesla likely was prepared to make a purchase as early as the first day after enacting this policy change.
Tesla purchased 46,863 Bitcoin for an average price of around $32,000.00. They reduced their holdings by 4,683 Bitcoin over the following three months and continue to hold 42,176.8 Bitcoin as of March 31, 2021.
This would put their $BTC ownership at $2.48B on March 31, 2021.
Quarterly Balances
Tesla reduced holdings by 4286.3 $BTC over the three months for a total of $272M, giving a net profit of $101M.Their initial holding was $1.5B. Minus the $171M, there should be $1.329B carry cost on their balance sheet.
On their Q1 2021 update, they list that they have a NET $1.331 in digital assets. This suggests that they have received around $2M by selling Tesla vehicles for Bitcoin.
It stands to reason that Tesla has approximately 42,204 Bitcoin(+/- 20) currently after selling $2M in Tesla cars for Bitcoin; this would give them the digital asset net value of $1.331B USD in Bitcoin as seen in their balances in the April 26, 2021 Quarterly Update.
As seen in the following picture, the $1.2B outflow in cryptocurrency can be understood to be the initial investment of $1.5B minus the $0.272B sold in late March rounding to the closest $0.1B.
I welcome any comments, advice, or criticism. I would enjoy a discussion as to where their profit of $128M and impairment of $27M occurred. Their April 28th press release certainly clears up a lot of confusion.
This is my first article, and I will be glad to make edits where necessary to ensure the accuracy and correctness of these statements. The above numbers are within 1% of the actual numbers based on TSLA’s public filings.
