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Tesla, MicroStrategy, Block’s bet on Bitcoin leads to $5B loss on books in Q2 – Bloomberg

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Tesla, MicroStrategy and Block’s bet on Bitcoin (BTC) resulted in a combined accounting loss of $5 billion in the second quarter, according to Bloomberg News. informed 22 July.

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The 59% drop in bitcoin during the quarter resulted in staggering losses for these companies, based on their previous asset disclosures, according to the report.

microstrategy

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MicroStrategy covers 70% of the $5 billion loss as it spent about $4 billion to buy 129,699 bitcoins. The business intelligence company’s losses are estimated at about $3.4 billion.

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However, this did not stop either the company or its CEO, Michael Saylor, from continuing to hold BTC. The last purchase of MicroStrategy was made on June 29 in BTC in the amount of $10 million.

Tesla

On July 20, Tesla said it sold 75% of its bitcoin holdings for $936 million at an average sale price of $29,714 per BTC.

Tesla, meanwhile, reported that the loss from bitcoin’s depreciation impacted its profitability.

Despite the loss, Elon Musk has hinted that the electric car maker is still open to buying more bitcoin in the future and that the sale of the company should not be taken as a “judgment” to the asset.

Block Inc.

On March 31, Block Inc., led by Jack Dorsey, owned $336 million worth of Bitcoin. data indicated that the stash is now worth approximately $190 million, a loss of $146 million in the second quarter.

The loss does not seem to stop Dorsey, who continues to preach about Bitcoin. Recently founder of Twitter partner with Jay Z to create an educational program called Bitcoin Academy to raise awareness about cryptocurrencies in underprivileged areas.

Expert opinions

The losses showed companies the risk of buying a volatile asset like bitcoin, according to experts who spoke with Bloomberg.

Matt Maley added that companies holding the coin might be tempted to sell it if the asset experiences another significant drop.

However, crypto enthusiasts such as Justin Sun have stated that Tesla’s ability to sell nearly $1 billion worth of the coin showed liquidity in the market and that he expects “bigger corporations” to buy the asset in the future.





Credit : cryptoslate.com

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