Tesla Profits $589 Million from Bitcoin Investment

Bittime - Tesla recently reported huge profits from their Bitcoin investment in the fourth quarter of 2024. Based on financial reports released on January 29, 2025, Tesla made a profit ofwith $600 million thanks to the increase in the value of their Bitcoin assets. This happened thanks to changes in accounting rules from Financial Accounting Standards Board (FASB) which allows companies to record the market value of their crypto assets.

Tesla Bitcoin Value Surge

Tesla reported that in the fourth quarter of 2024, the value of the Bitcoin they hold will reach more than 100%ugh from $1 billion, a significant improvement compared to $184 million in previous quarters. This brings Tesla to a net profit of $589 million from their Bitcoin investments. Until now, Tesla has 9.720 BTC the tercatat in their cash.

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This change in accounting rules allows companies to record the market value of their crypto assets, which previously could only be calculated based on the lowest value in the accounting period. With these new rules, companies can more accurately reflect market conditions in their financial reports.

Tesla's financial performance is quite worrying

Despite huge profits from Bitcoin, Tesla's financial performance in the fourth quarter of 2024 did not meet market expectations. Tesla reports net income as big as $2.3 billion and total income reached $25.71 billion, which only experienced an increase of 2% compared to last year. However, this is still below analyst projections, which estimate revenue of $27.22 billion. Tesla's earnings per share were also slightly lower than expected, i.e $0,73 compared to expected ie $0,76. Tesla's operating costs also increased by more than 9% compared to the previous quarter.

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In response to this report, Tesla's share price fell 2,26% on January 29, although it then experienced an increase of 4,15% after trading hours, hit the price $405.25 per share.

Texas and Other States Set Up Bitcoin Proposals

Tesla's success with Bitcoin has likely inspired several states in the US, including Texas, which are working on plans to form Bitcoin proposal their state. 

Texas Governor Dan Patrick recently announced his legislative priorities for 2025, which include a proposal to establish a Texas Bitcoin Reserve. Several other states, such as Wyoming And Arizona, has also initiated similar steps.

This Texas move is not just about storing Bitcoin, but also allows Bitcoin to be used to pay state taxes and fees. The move is expected to strengthen Texas' position in the rapidly growing digital economy.

Czech National Bank Considers Bitcoin Investment

Meanwhile, in Europe, Czech National Bank (CNB) is considering becoming the first central bank in Europe to invest in Bitcoin as part of their foreign exchange reserve diversification strategy. CNB Governor, Ales Michl, is scheduled to present a Bitcoin investment plan to the bank's board on January 30, 2025. If approved, this investment could reach more than $7.3 billion in Bitcoin purchases, which will significantly expand their reserve allocation significant.

This increase in interest in Bitcoin reflects changes in global attitudes towards crypto, especially in developed countries who are starting to see Bitcoin as a viable investment alternative.

Bitcoin's Future Prospects

Although Bitcoin experiences occasional price corrections due to macroeconomic factors, such as the overdue US debt ceilingh reach $36 trillion, many analysts remain optimistic about Bitcoin's long-term prospects. Some projections suggest that Bitcoin prices could reach $160,000 to $180,000 in 2025, although there is a possibility of a temporary price correction heading $70.000.

The growing institutional interest in Bitcoin, as seen with the moves of Tesla, Texas, and the Czech National Bank, suggests that Bitcoin will continue to be a relevant asset in the future, despite the near-term challenges to be faced.

FAQ

How much profit will Tesla earn from Bitcoin in the fourth quarter of 2024?

Tesla made a profit of $589 million of their Bitcoin investments in the fourth quarter of 2024 thanks to new accounting rule changes.

Has Tesla's financial performance also improved?

Despite making huge profits from Bitcoin, Tesla's financial performance did not meet market expectations, with revenue and earnings per share lower than expected.

What is Texas doing about Bitcoin?

Texas plans to form Bitcoin proposal and allows paying taxes and state fees with Bitcoin, making it one of the states that officially supports crypto.

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Reference

Coinpaper, Tesla Reports $600 Million Bitcoin Gain in Fourth Quarter, accessed January 31, 2025.

Author: MF