Electric vehicle manufacturing giant Tesla has reported it profited $600 million from its Bitcoin holdings in the fourth quarter of 2024. Tesla achieved the impressive feat partly due to new accounting rules that allow entities to report the market value of their cryptocurrency holdings.
The company’s 9,720 BTC balance was worth $1.076 billion at the end of 2024, far more than the $184 million valuation the same balance was worth in previous quarters. In addition to the large jump, Tesla also announced a significant GAAP income spike of $600 million on its digital assets.
Like many other cryptocurrencies, Bitcoin is used as a store of value and an investment vehicle by individuals and corporate entities alike. The asset’s performance shows the potential for cryptocurrencies to provide investors with impressive returns over time. In addition to investing in Bitcoin, cryptocurrency enthusiasts looking to diversify their portfolios can find options on newcryptocurrency.com to enjoy the sector’s remarkable performance, as well as other earning opportunities from decentralized finance (DeFi) like staking.
The Tesla report took advantage of a new rule from the Financial Accounting Standards Board (FASB) finalized in 2023. According to the rule, corporate entities with crypto portfolios can mark their holdings to market each quarter. Before the new rule, companies had to report their balances using the portfolio’s lowest valuation throughout the ownership period. With the new rule, companies now have more access to working capital by borrowing against their crypto holdings and using their portfolios as collateral. Furthermore, the new rule simply makes it easier for these entities to maintain their crypto exposure. According to John Glover, the chief investment officer at crypto-focused financial services company Ledn:
“BTC holdings typically generate yields in the 3%-4% range, with some corporate treasuries actively lending to crypto firms to meet rising borrowing demand.”
Tesla ventured into the Bitcoin market in February 2021 when it bought $1.5 billion worth of the asset, worth about $43,000 per token. The move supported CEO Elon Musk’s Bitcoin advocacy following his consistent and public support of crypto, especially Dogecoin (DOGE).
However, Tesla has since sold most of its Bitcoin. In March 2021, the company sold 10%, and then another 75% in 2022. As of January last year, when Bitcoin sold for about $41,500, it was reported that Tesla would have made $300 million in profit after sales if it maintained the balance.
According to data from Bitcoin Treasuries, Tesla’s current balance of 9,720 BTC is worth $946.44 million, rising more than 180% since the first purchase. Interestingly Arkham Intelligence reports a higher figure, with holdings at 11,509 BTC and worth $1.12 billion.
Tesla is one of several Bitcoin-forward companies that has maintained a healthy balance of the world’s king coin. Business intelligence company Strategy (formerly MicroStrategy) is considered the world’s largest corporate holder of Bitcoin, with 450,000 BTC in holdings as of January 13, 2025. A filing with the United States Securities and Exchange Commission (SEC) revealed that Strategy acquired 2,530 BTC for about $243 million in cash between January 6, 2025, and January 12, 2025. The Bitcoin was purchased at an average price of approximately $95,972 per coin, including expenses and fees.
Another firm, Metaplanet, is following Strategy’s path and also buying Bitcoin. Since announcing a Bitcoin treasury strategy in April 2024, Metaplanet’s stock has spiked 4,800%. The Japanese company, known as “Asia’s MicroStrategy” holds 1,762 BTC as of January 28, and plans to buy up to 21,000 BTC by 2026.
