Tesla posts a net loss of $140 million in Bitcoin in 2022

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According to a filing with the U.S. Securities and Exchange Commission on January 31, electric vehicle maker Tesla disclosed that it recorded a gross loss in value of $204 million in 2022 on its bitcoin (BTC) holdings. Simultaneously, Tesla recorded a $64 million gain from converting BTC into fiat currency at various times throughout the year, resulting in a net loss of $140 million on its cryptocurrency trading business.

The filing further explains the impact of volatile crypto prices on Tesla’s results:

“Digital assets are considered indefinite-lived intangible assets under applicable accounting rules. Accordingly, any decrease in their fair value below our carrying values ​​for such assets at any time after their acquisition will require us to recognize impairment charges, while we cannot make upward revisions for any increase in market prices until a sale. For any digital asset held now or in the future, these charges may negatively impact our profitability during periods in which such write-downs occur, even if the overall market value of such assets increases.

Related: Elon Musk Indicates When Tesla Will Start Accepting Bitcoin Payments

In the first quarter of 2021, Tesla invested $1.5 billion in Bitcoin. At the time, its founder, Elon Musk, announced that the electric vehicle maker would start accepting BTC payments from US-based consumers.

The policy was withdrawn a few months later, as Musk cited the need to “confirm reasonable (~50%) use of clean energy by [Bitcoin] miners with a positive future trend”, before the company accepts the means of payment again. Tesla reportedly sold 75% of its BTC holdings in Q2 2022.

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