Keith McCullough, CEO of Hedgeye, has called attention to the parallel losses of Tesla and Bitcoin, noting that both assets have fallen by more than 50% since their peak in November 2021. The price of a share of Tesla is currently $181.15, while the price of a bitcoin is $29,293.30.
Within three days of one another, the value of the two assets peaked, with Bitcoin plunging 57% and Tesla’s shares losing 55% since then.
According to U.Today, Tesla recently disclosed that company owns 9,720 bitcoins and suffered an impairment loss of $34 million as a result of the declining value of the cryptocurrency in January.
Early in 2021, Tesla made the bold decision to invest $1.5 billion in Bitcoin, shocking the market. According to some commentators, the action was a smart diversification scheme. Some brushed it off as a risky bet. The Bitcoin wager was mainly unsuccessful despite strong hopes.
The argument regarding the company’s justification for entering the risky cryptocurrency market was further fueled in July of last year when the electric vehicle maker unloaded the majority of its Bitcoin holdings.
Tesla and Bitcoin both suffered terrible losses, but in 2023, both assets showed a glimpse of optimism. The year-to-date performance of Tesla shows a 67.56% increase, whereas the year-to-date performance of Bitcoin shows a 76.41% increase.
