While the Bitcoin price was steadily moving toward new historical highs, Tesla, which once made a high-profile bet on cryptocurrency, found itself excluded from this boom. A recent report from the company revealed that the cost of its remaining digital assets has risen to $1.24 billion from $722 million a year ago.
However, this positive trend pales in comparison to the potential benefits that the company could have gained by keeping its original investment. According to current estimates, the missed profits are nearing $5 billion.
In February 2021, Tesla shocked the market by announcing an investment of $1.5 billion in Bitcoin. The company cited the long-term potential of cryptocurrencies and the desire to diversify assets beyond traditional ones.
Elon Musk is a major supporter of cryptocurrencies. His social media posts, including those with the #bitcoin tag, have a market-moving effect: the BTC USD rate soared by 20% a day after such statements, and Tesla stock attracted the attention of all market participants.
At the same time, Musk has repeatedly stressed that Tesla’s strategic future lies in developing autonomous robotaxis and humanoid Optimus robots, rather than in crypto speculation.
The situation changed dramatically by the middle of 2022:
- Macroeconomic shock: Soaring inflation and the aggressive increase in interest rates by the Fed have provoked investors to flee risky assets.
- Falling markets: The stock and cryptocurrency markets collapsed simultaneously. Tesla’s capitalization decreased by two thirds, Bitcoin sank by 60%.
- Strategic solution: Under these conditions, Tesla decided to sell 75% of its Bitcoins. The company attributed the move to the need to strengthen its cash balance during a period of high uncertainty. The sale came at a time when Bitcoin’s price was a mere fraction of what it is now.
The subsequent growth of Bitcoin turned out to be equally impressive — at the moment, the OG cryptocurrency is stable around $115,000. This is about six times higher than the level at which Tesla sold the bulk of its assets in the second quarter of 2022. If the company had kept all the Bitcoins originally purchased, their current value would be estimated at $5 billion instead of the existing $1.24 billion. The lost profit is about $3.76 billion.
The situation presents an ironic contrast to Tesla’s current results. The remaining Bitcoins continue to yield profits. In the second quarter of 2025, revenue from the revaluation of digital assets amounted to $284 million, a significant portion of the company’s total net profit of $1.17 billion.
Meanwhile, its EV business faces pressure. At the same time, Tesla’s core business is showing alarming signals:
- Revenue decline: Revenue from the sale of electric vehicles has fallen for the second quarter in a row.
- Stock drawdown: Over the past year, the company’s securities have fallen in price by 25%, which is significantly worse than the dynamics of other technology giants.
- The Musk factor: Some analysts attribute Tesla’s weakening position to its founder’s active political involvement. From January through May, the billionaire was positioned as the “right-hand man” of the US President Donald Trump. However, by the end of this period, Musk and Trump had publicly quarrelled, fueling investor uncertainty about the brand.
Notably, over the past three years, Elon Musk has largely remained silent about Bitcoin on his social media platforms. In March 2022, shortly before the massive sale of Tesla assets, he stated that he owns Bitcoin, Ethereum, and Dogecoin and has no plans to part with them. However, this didn’t prevent his company from making a strategic but premature exit in retrospect.
Tesla’s Bitcoin story is a clear example of how a strategic asset management decision dictated by short-term market risks can result in massive losses over the long term. While the remaining crypto assets generate profits to the company, the shadow of the lost $5 billion raises questions about the cost of caution during market downturns.
If Tesla had remained faithful to its original declaration of “long-term potential,” its crypto portfolio today would have placed it among the absolute leaders in Bitcoin holdings by book value among public companies, and the lost billions would have become a powerful buffer against falling sales of electric vehicles.
The race for crypto earnings, initially led by Tesla, is now underway without its active participation, leaving only an expensive lesson about exit timing.
