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Tesla’s January Bitcoin Purchase Proves to be Profitable Already

On Tuesday, for the first time, Bitcoin hit $50,000. In January, Tesla had purchased $1.5 billion in Bitcoin. The average purchase price of the amount of Bitcoin it holds is still undisclosed by the company. Tesla’s purchase made the cryptocurrency move higher, creating attractive profits for them.

Bitcoin traded between $29,333 and $37,020, in January. With the $1.5 billion purchase, Tesla might have somewhere between 37,020 and 51,137 Bitcoin. The Bitcoin average would come up to 44,079. If these are the scenarios, Tesla’s Bitcoin value with the current bitcoin price of $48,450 would be somewhat like this:

  • 44,079 Bitcoin: $2.14 billion, profit of $0.64 billion
  • 37,020 Bitcoin: $1.79 billion, profit of $0.29 billion
  • 51,137 Bitcoin: $2.48 billion, profit of $0.98 billion

The Bitcoin purchase by Tesla created a validation for the cryptocurrency for the public. It has also become a path to follow for other publically traded companies. Bitcoin also offers notable gains. In Tesla’s case, the possibility is it made more from its Bitcoin purchase than from its entire business in the fiscal year 2020.

Fiscal 2020 was Tesla’s first profitable year with $721 million after the $862 million loss in fiscal 2019. Before this, Tesla has only reported a few quarterly profits. Given its records, Tesla may have earned more from its cryptocurrency purchase than it ever made from its car sales.

With time the company will disclose the amount of Bitcoin they have and their plans for it, holding or selling.

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