February 1, 2023

Tesla Records USD 140 Mln Loss from Crypto Activities

Tesla Records USD 140 Mln Loss from Crypto Activities Featured Image

Electric vehicle manufacturer Tesla announced that it has recorded a net loss worth $140 million from its cryptocurrency trading activities in 2022

According to a filing with the US Securities and Exchange Commission, Tesla’s gross impairment loss on its Bitcoin holdings reached $204 million, according to Cointelegraph.

At the same time, the electric vehicle maker reported gains worth $64 million from converting Bitcoin assets into fiat currency during different periods of the last year.

The filing, which highlighted the impact of the bearish crypto market in 2022 on Tesla, said: “Digital assets are considered indefinite-lived intangible assets under applicable accounting rules. Accordingly, any decrease in their fair values below our carrying values for such assets at any time subsequent to their acquisition will require us to recognize impairment charges, whereas we may make no upward revisions for any market price increases until a sale. For any digital assets held now or in the future, these charges may negatively impact our profitability in the periods in which such impairments occur even if the overall market values of these assets increase.”

In the first quarter of 2022, Tesla invested $1.5 billion in Bitcoin in addition, it announced it accepted Bitcoin as a method of payment from US customers and Dogecoin later. But after days, Tesla canceled this payment option raising concerns over the increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, the worst emissions of any fuel. In the second quarter of 2022, Tesla reportedly sold 75% of its BTC holdings for $936 million after acquiring some 43,200 bitcoins for $1.5 billion.

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