Bitcoin recovers after sell-off on news Tesla sells 75% of its stake

Bitcoin recovers after sell-off on news Tesla sells 75% of its stake

Bitcoin recovers after falling on news Tesla sells 75% of its stake

Bitcoin rebounded after a brief sell-off late Wednesday that electric car maker Tesla Inc sold nearly 75 percent of its stake in the virtual token.

Tesla Chief Executive Elon Musk cited concerns about his company’s “overall liquidity” as the reason for the sale.

The world’s largest cryptocurrency gained 1.04 per cent to $23,494.57, after falling 0.5 per cent to $23,268.92.

Tesla sold $936 million worth of bitcoin in the second quarter, more than a year after the company bought the cryptocurrency for $1.5 billion at the peak of its massive growth and popularity.

Musk has been a vocal supporter of cryptocurrencies. His statements on the future of crypto and revelations about his ownership of digital assets often drive the price of Dogecoin and Bitcoin.

On Tesla’s earnings call, Musk said the primary reason for sales was uncertainty about the lockdown due to COVID-19 in China, which has created production challenges for the company.

“It was important for us to maximize our cash position,” Musk said. “We are certainly open to increasing our bitcoin holdings in the future, so this should not be taken as some judgment on bitcoin. It is just that we were concerned about the overall liquidity for the company.”

Musk said Tesla did not sell any of its Dogecoin, a meme-based cryptocurrency he touted.

Tesla accepted bitcoin as payment for less than two months before halving in May 2021. Musk has said that the company may resume accepting bitcoin once it does due diligence on the amount of renewable energy needed to mine the currency.

Bitcoin has been in recovery mode so far this week, in line with the stock market, as investors appear more optimistic about the US Federal Reserve’s ability to rein in decades-high inflation.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)


Indian Lekhak

Leave a Reply

Your email address will not be published. Required fields are marked *