Tesla Inc. TSLA, in a filing with the U.S. Securities and Exchange Commission on Monday morning, revealed that it suffered impairment losses of $101 million on its Bitcoin BTC/USD holdings in 2021.
What Happened: The electric vehicle maker said the fair market value of its Bitcoin holdings at the end of the year was $1.99 billion. The company had invested $1.5 billion in the world’s apex cryptocurrency in the first quarter.
Tesla noted the $128 million made in gains on certain Bitcoin sales it made in the first quarter of 2021.
The Elon Musk-led company said in the SEC filing that it continued to “believe in the long-term potential of digital assets both as an investment and also as a liquid alternative to cash.”
Tesla also noted that it may “increase or decrease" its holdings of digital assets "at any time” based on the needs of the business and its view of market and environmental conditions.
See Also: How To Buy Bitcoin (BTC)
Why It Matters: Tesla invested in Bitcoin in early 2021, becoming the biggest company — in terms of market capitalization — to make such a move.
The EV maker also briefly accepted Bitcoin on its online store but soon retracted its move amid concerns being expressed over the environmental impact of Bitcoin.
Musk is a major Dogecoin DOGE/USD bull and Tesla recently began accepting the meme cryptocurrency on its store for some merchandise.
Both Bitcoin and Dogecoin utilize proof-of-work consensus mechanisms in their network, but Dogecoin mining is based on scrypt technology, which makes it less energy-intensive.
Price Action: Tesla shares traded 0.5% lower at $918.81 in the pre-market session on Monday and Bitcoin traded 2.8% higher at $42,706.85.
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